GameStop in board overhaul in deal with activist investor
Changes have come to the GameStop board.
The video game retailer announced an agreement with activist investor RC Ventures LLC that includes the immediate appointment of three new directors. RC Ventures, one of GameStop’s largest shareholders, is managed by Ryan Cohen, the co-founder and former CEO of Chewy Inc. The new directors include Cohen and two former Chewy colleagues, Alan Attal and Jim Grube.
Cohen, who sold Chewy for $3.35 billion to PetSmart in 2017, has been pushing for GameStop to focus on online gaming and trim its store portfolio. The company has more than 5,000 stores across 10 countries.
“We are excited to bring our customer-obsessed mindset and technology experience to GameStop and its strategic assets,” said Cohen. “We believe the company can enhance stockholder value by expanding the ways in which it delights customers and by becoming the ultimate destination for gamers. Alan, Jim and I are committed to working alongside our fellow directors and the management team to continue to transform GameStop. In addition, we intend to bring additional ownership perspectives to the boardroom.”
Added GameStop CEO George Sherman: “We appreciate the constructive dialogue we have had with Ryan over the past several months. Together, we have reached an outcome that is in the best interest of all stockholders and can enable GameStop to accelerate efforts to deliver enhanced value for the company."
The new directors will stand for election on GameStop’s nine-member slate at the company’s 2021 annual shareholders’ meeting in June. Current board members Lizabeth Dunn, Raul Fernandez, James K. Symancyk and Kathy do not intend to stand for reelection at the meeting.
Separately, GameStop said same-store sales for the nine-week holiday sales period ended Jan. 2 rose 4.8% from the year-ago period. Net sales for the period fell 3.1% to $1.77 billion as strong demand for gaming consoles was offset by store closures. Online sales skyrocketed 309% to represent about 34% of total sales.