Gametop’s stock price rose on Monday as struggling video-game retailer revealed activist investor Ryan Cohen claimed responsibility for its turnaround.
Shares of the Texas-based chain gained 11 percent to $ 153.00 in pre-trade. After announcing that Cohen is heading a new committee to convert GameStop into an e-commerce business.
The co-founder of Chewy.com is seen as a potential savior of GameStop by some fraudulent investors on Reddit’s WallStreetBets forum, whose efforts put the company’s stock at the center of the recent market revolution.
Cohen joined GameStop’s board of directors in January, after acquiring a 13 percent stake and pressuring authorities to transition from an old brick-and-mortar retailer to a digitally focused gaming company.
Gametop now gave Cohen the chair of a three-man “Strategic Planning and Capital Allocation Committee” to guide that change.
The company said in a news release, “It is responsible for evaluating those areas, including Gametop’s current operational objectives, capital structure and allocation priorities, digital capabilities, organizational footprint and personnel.”
The panel has appointed officials to oversee GameStop’s e-commerce fulfillment and customer care operations, and a new chief financial officer with e-commerce and technology experience to replace outgoing CFO James Bell, who leaves at the end of the month Is looking for, the company said.
According to the news release, the committee is also exploring ways to “help turn GameTop into a technology business and create lasting value for stockholders.”
It was the focus of one November letter Cohen sent Gametop’s board, stating that the series had failed to keep up with the industry’s “transition from physical hardware to digital streaming”.
Cohen effectively lit the fuse for GameStop’s explosive rally that sent its share price as late as $ 483 at the end of January.
His view was that amateur traders at Reddit were left to buy the company’s stock before they would go to war with institutional investors betting against it.
Cohen appeared in late February with a photo of a McDonald’s ice cream con with a secret Twitter post to set up another boom, sparking wild speculation about what it might mean for GameShop.
Twitter users also tried to understand Another bizarre post Cohen showed screenshots last week from an advertisement for Joe Pets.com, the online pet supply retailer that was a precursor to Chevy.
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