Last Tuesday we reported that ThinkGeek’s parent company Geeknet Inc. was in the process of being bought out by mall-based retailer Hot Topic for $17.50 per share and $37 million in cash, and that the acquisition would close by June 19. That deal is now off, thanks to an even better deal offered by an anonymous "strategic acquiror" that turned out to be none other than an even bigger mall-based retailer: GameStop.
First mentioned in a press release from May 29, GameStop offered $20 per share, which Geeknet’s board determined was a good enough deal that it qualified under the terms of the Hot Topic merger agreement as a legitimately superior proposal. Hot Topic had until 9:00am EDT on June 1 to meet or exceed the new proposal; that time came and went without a new offer from Hot Topic.
GameStop’s $20 per share deal also includes $37 million in cash and comes out to a total valuation of $140 million (compared to Hot Topic’s proposal value of $122 million), and the Geeknet board of directors has formally accepted it as of this morning. As part of the change in direction, Geeknet must pay Hot Topic a three percent "break-up fee," which GameStop has agreed to reimburse.
According to the new press release, GameStop’s acquisition of Geeknet (and therefore ThinkGeek) will have several impacts that will be visible to customers, including potentially allowing ThinkGeek customers to pick up ThinkGeek merchandise in GameStop stores. The press release also mentions the potential of offering GameStop PowerUp Rewards members "exclusive, unique and cutting edge merchandise related to their favorite entertainment," presumably from the ThinkGeek catalog.
Assuming no more surprise buyers swoop in with even better offers, the deal should be concluded by the end of GameStop’s second financial quarter of 2015, which will happen in August.
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