Exhibit 99.1
GameStop Becomes Leading Global Game Retailer
GRAPEVINE, Texas, Oct 10, 2005 (BUSINESS WIRE) -- Merger Between GameStop Corp.
and Electronics Boutique Holdings Corp. Closes
GameStop Becomes Largest Video Game Retailer with Over 4,200 Stores Operating in
the US and 15 Countries
World-Wide
Four New GameStop Corp. Board Members Announced
Merchandising and Operational Synergies to Benefit Consumers and Stockholders
GameStop Corp. ("GameStop") (NYSE:GME)(NYSE:GME.B) announced today that GameStop
Holdings Corp. (formerly known as GameStop Corp.) ("Historical GameStop") has
completed the transaction announced April 18, 2005 combining GameStop and
Electronics Boutique Holdings Corp. ("Electronics Boutique") into a new public
company named GameStop Corp. (formerly known as GSC Holdings Corp.).
At separate stockholders' meetings, each held on October 6, 2005, the
stockholders of both Historical GameStop and Electronics Boutique approved the
business combination. The companies closed the business combination on October
8, 2005 and trading of the GameStop Class A and Class B common stock will begin
on October 10, 2005 on the New York Stock Exchange under the symbols "GME" and
"GME.B", respectively. Historical GameStop will no longer be listed and traded
on the New York Stock Exchange and Electronics Boutique will no longer be quoted
on the NASDAQ Stock Market.
R. Richard Fontaine will serve as GameStop's Chairman and Chief Executive
Officer, Daniel A. DeMatteo as Vice Chairman and Chief Operating Officer, Joe
DePinto as President and David W. Carlson as Executive Vice President and Chief
Financial Officer.
"Merging Electronics Boutique with GameStop immediately creates a specialty
retailer with unsurpassed capabilities," indicated Fontaine, "Combining our best
practices within a streamlined organizational structure will not only serve our
customers better, but will make us a more efficient and productive high-growth
company."
Formally joining the GameStop Corp. Board of Directors will be four outside
business leaders:
-- James J. Kim. As the founder of Electronics Boutique, Mr. Kim served as
Chairman of its Board of Directors. Mr. Kim has maintained a distinguished
career, notably as the Chairman and Chief Executive of Amkor Technology, Inc.
("Amkor") and Amkor Electronics, Inc. ("AEI") since September 1997 and 1968,
respectively. In April 1998, AEI merged with and into Amkor. Amkor is a
semiconductor assembly, testing and packaging technology firm.
-- Stanley ("Mickey") Steinberg. Formerly a Director of Electronics Boutique,
Mr. Steinberg is a Senior Advisor to the mergers and acquisitions firm of Cosas,
Benjamin and While, LLC. Previously he held executive management positions with
Sony Retail Entertainment and Walt Disney Imagineering. Mr. Steinberg is a
member of the board of Reckson Associates Realty Corp. and of two privately held
companies, AMC, Inc., the owner and manager of the America's Mart Atlanta
Tradeshow center, and ECL Group, an apartment development, construction and
management company.
-- Jerome L. Davis. Mr. Davis is former Global Vice President, Service
Excellence at Electronic Data Systems (EDS). Mr. Davis joined EDS as President
of its Business Process Management unit for the Americas and was named Chief
Client Executive Officer in 2002. Prior to EDS, he was President and Executive
Officer for Maytag Commercial Solutions, having started with Maytag Corporation
in 1998 as Senior Vice President, Sales for Maytag Appliances. Mr. Davis also
held executive and general management leadership positions with Frito-Lay, Inc.,
a division of PepsiCo and Procter & Gamble Company. Mr. Davis also serves on the
board of Apogee Enterprises, Inc.
-- Larry S. Zilavy. Mr. Zilavy retired as Executive Vice President, Corporate
Finance and Strategic Planning for Barnes & Noble, Inc. in November 2004 and had
served in that position since May 2003. Mr. Zilavy was Chief Financial Officer
of Barnes & Noble, Inc. from June 2002 through April 2003. Prior to that, he was
Executive Vice President of IBJ Whitehall Bank and Trust Company, where he
worked since 1992. Mr. Zilavy has served as a director of The Hain Celestial
Group, Inc. since November 2002. Mr. Zilavy is a trustee of St. Francis College
in New York City.
"We are fortunate to have executives of this caliber joining the GameStop
board," said Daniel A. DeMatteo, Vice Chairman and Chief Operating Officer of
GameStop. "They bring tremendous experience and diversify the knowledge and
leadership that can only make us a stronger company."
Messrs. Kim, Steinberg and Davis will qualify as independent directors under the
rules of the New York Stock Exchange. Messrs. Kim and Steinberg have joined the
board effective as of the business combination, in accordance with the terms of
the merger agreement. The appointment of Messrs. Davis and Zilvay is effective
as of October 15, 2005.
In accordance with the terms of the merger agreement, Historical GameStop and
Electronics Boutique each became wholly-owned subsidiaries of GameStop Corp.
Each share of Common Stock of Electronics Boutique was converted into (i) $38.15
in cash without interest and (ii) .78795 shares of GameStop Class A Common
Stock. No fractional shares of GameStop will be issued, and Electronics Boutique
stockholders who otherwise would be entitled to receive fractional shares are
entitled to receive a cash payment in lieu of those fractional shares. In
addition, each share of Class A Common Stock of Historical GameStop was
converted into one share of GameStop Class A Common Stock and each share of
Class B Common Stock of Historical GameStop was converted into one share of
GameStop Class B Common Stock. GameStop is funding the cash portion of the
consideration to be paid to the former EB stockholders from the proceeds of the
previously announced offering of U.S. $300,000,000 aggregate principal amount of
Senior Floating Rate Notes and $650,000,000 aggregate principal amount of 8%
Senior Notes, which were released out of escrow in connection with the closing
of the business combination, and excess cash.
In connection with the transaction, GameStop also announced that it is entering
into a $400 million senior secured revolving credit facility, which expires in
October 2010. Borrowings under the revolving credit facility will be limited by
an eligible inventory borrowing base, defined as the lesser of (x) approximately
70% of non-defective inventory, or (y) 90% of the net appraised inventory
liquidation value, plus, in each case, 85% of eligible credit card receivables
less certain reserves. Loans incurred under the credit facility will be
maintained from time to time, at GameStop's option, as: (1) Prime Rate loans
which bear interest at the prime rate (defined in the credit facility as the
higher of (a) the administrative agent's announced prime rate, or (b) 1/2 of 1%
in excess of the federal funds effective rate, each as in effect from time to
time); or (2) LIBO Rate loans bearing interest at the LIBO Rate for the
applicable interest period, in each case plus an applicable interest margin
ranging from 0% to 1.75% based on GameStop's consolidated leverage ratio. In
addition, GameStop is required to pay a commitment fee for any unused amounts of
the revolving credit facility, currently ranging from 0.375% to 0.50%, based on
GameStop's consolidated leverage ratio. Any borrowings under the revolving
credit facility are secured by the assets of GameStop and its direct and
indirect wholly-owned domestic subsidiaries, which are co-borrowers. Under
certain circumstances, the revolving credit facility may restrict GameStop's
ability to pay dividends.
ABOUT GAMESTOP CORP.
Headquartered in Grapevine, TX, GameStop Corp. (NYSE:GME) (NYSE:GME.B) is one of
the nation's largest video game and entertainment software retailers. The
combined company operates over 4,200 retail stores throughout the United States,
Australia, Canada, Denmark, Finland, Germany, Italy, Ireland, New Zealand,
Norway, Puerto Rico, Spain, Sweden, Switzerland and the United Kingdom. In
addition, the company owns commerce-enabled Web properties, GameStop.com and
ebgames.com, and Game Informer(R) magazine, a leading video and computer game
publication. GameStop Corp. sells the most popular new software, hardware and
game accessories for the PC and next generation video game systems from Sony,
Nintendo, and Microsoft. In addition, the company sells computer and video game
magazines and strategy guides, action figures, and other related merchandise.
General information on GameStop Corp. can be obtained via the Internet by
visiting the company's corporate Website:
http://www.gamestop.com/investor-relations/.
SAFE HARBOR
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements include, but
are not limited to, statements about the benefits of the business combination
transaction involving Historical GameStop and Electronics Boutique, including
future financial and operating results, GameStop's plans, objectives,
expectations and intentions and other statements that are not historical facts.
Such statements are based upon the current beliefs and expectations of
GameStop's management and are subject to significant risks and uncertainties.
Actual results may differ from those set forth in the forward-looking
statements.
The following factors, among others, could cause actual results to differ from
those set forth in the forward-looking statements: the risk that the businesses
of Historical GameStop and Electronics Boutique will not be integrated
successfully; the risk that the cost savings and any other synergies from the
transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain
relationships with customers, employees or suppliers; and competition and its
effect on pricing, spending, third-party relationships and revenues. Additional
factors that could cause GameStop's results to differ materially from those
described in the forward-looking statements can be found in the Annual Reports
on Forms 10-K/A of Historical GameStop and Electronics Boutique for the fiscal
year ended January 29, 2005 and GameStop's Form S-4 filed in connection with the
business combination filed with the SEC and available at the SEC's Internet site
at http://www.sec.gov.
GameStop Becomes Leading Global Game Retailer
GRAPEVINE, Texas, Oct 10, 2005 (BUSINESS WIRE) -- Merger Between GameStop Corp.
and Electronics Boutique Holdings Corp. Closes
GameStop Becomes Largest Video Game Retailer with Over 4,200 Stores Operating in
the US and 15 Countries
World-Wide
Four New GameStop Corp. Board Members Announced
Merchandising and Operational Synergies to Benefit Consumers and Stockholders
GameStop Corp. ("GameStop") (NYSE:GME)(NYSE:GME.B) announced today that GameStop
Holdings Corp. (formerly known as GameStop Corp.) ("Historical GameStop") has
completed the transaction announced April 18, 2005 combining GameStop and
Electronics Boutique Holdings Corp. ("Electronics Boutique") into a new public
company named GameStop Corp. (formerly known as GSC Holdings Corp.).
At separate stockholders' meetings, each held on October 6, 2005, the
stockholders of both Historical GameStop and Electronics Boutique approved the
business combination. The companies closed the business combination on October
8, 2005 and trading of the GameStop Class A and Class B common stock will begin
on October 10, 2005 on the New York Stock Exchange under the symbols "GME" and
"GME.B", respectively. Historical GameStop will no longer be listed and traded
on the New York Stock Exchange and Electronics Boutique will no longer be quoted
on the NASDAQ Stock Market.
R. Richard Fontaine will serve as GameStop's Chairman and Chief Executive
Officer, Daniel A. DeMatteo as Vice Chairman and Chief Operating Officer, Joe
DePinto as President and David W. Carlson as Executive Vice President and Chief
Financial Officer.
"Merging Electronics Boutique with GameStop immediately creates a specialty
retailer with unsurpassed capabilities," indicated Fontaine, "Combining our best
practices within a streamlined organizational structure will not only serve our
customers better, but will make us a more efficient and productive high-growth
company."
Formally joining the GameStop Corp. Board of Directors will be four outside
business leaders:
-- James J. Kim. As the founder of Electronics Boutique, Mr. Kim served as
Chairman of its Board of Directors. Mr. Kim has maintained a distinguished
career, notably as the Chairman and Chief Executive of Amkor Technology, Inc.
("Amkor") and Amkor Electronics, Inc. ("AEI") since September 1997 and 1968,
respectively. In April 1998, AEI merged with and into Amkor. Amkor is a
semiconductor assembly, testing and packaging technology firm.
-- Stanley ("Mickey") Steinberg. Formerly a Director of Electronics Boutique,
Mr. Steinberg is a Senior Advisor to the mergers and acquisitions firm of Cosas,
Benjamin and While, LLC. Previously he held executive management positions with
Sony Retail Entertainment and Walt Disney Imagineering. Mr. Steinberg is a
member of the board of Reckson Associates Realty Corp. and of two privately held
companies, AMC, Inc., the owner and manager of the America's Mart Atlanta
Tradeshow center, and ECL Group, an apartment development, construction and
management company.
-- Jerome L. Davis. Mr. Davis is former Global Vice President, Service
Excellence at Electronic Data Systems (EDS). Mr. Davis joined EDS as President
of its Business Process Management unit for the Americas and was named Chief
Client Executive Officer in 2002. Prior to EDS, he was President and Executive
Officer for Maytag Commercial Solutions, having started with Maytag Corporation
in 1998 as Senior Vice President, Sales for Maytag Appliances. Mr. Davis also
held executive and general management leadership positions with Frito-Lay, Inc.,
a division of PepsiCo and Procter & Gamble Company. Mr. Davis also serves on the
board of Apogee Enterprises, Inc.
-- Larry S. Zilavy. Mr. Zilavy retired as Executive Vice President, Corporate
Finance and Strategic Planning for Barnes & Noble, Inc. in November 2004 and had
served in that position since May 2003. Mr. Zilavy was Chief Financial Officer
of Barnes & Noble, Inc. from June 2002 through April 2003. Prior to that, he was
Executive Vice President of IBJ Whitehall Bank and Trust Company, where he
worked since 1992. Mr. Zilavy has served as a director of The Hain Celestial
Group, Inc. since November 2002. Mr. Zilavy is a trustee of St. Francis College
in New York City.
"We are fortunate to have executives of this caliber joining the GameStop
board," said Daniel A. DeMatteo, Vice Chairman and Chief Operating Officer of
GameStop. "They bring tremendous experience and diversify the knowledge and
leadership that can only make us a stronger company."
Messrs. Kim, Steinberg and Davis will qualify as independent directors under the
rules of the New York Stock Exchange. Messrs. Kim and Steinberg have joined the
board effective as of the business combination, in accordance with the terms of
the merger agreement. The appointment of Messrs. Davis and Zilvay is effective
as of October 15, 2005.
In accordance with the terms of the merger agreement, Historical GameStop and
Electronics Boutique each became wholly-owned subsidiaries of GameStop Corp.
Each share of Common Stock of Electronics Boutique was converted into (i) $38.15
in cash without interest and (ii) .78795 shares of GameStop Class A Common
Stock. No fractional shares of GameStop will be issued, and Electronics Boutique
stockholders who otherwise would be entitled to receive fractional shares are
entitled to receive a cash payment in lieu of those fractional shares. In
addition, each share of Class A Common Stock of Historical GameStop was
converted into one share of GameStop Class A Common Stock and each share of
Class B Common Stock of Historical GameStop was converted into one share of
GameStop Class B Common Stock. GameStop is funding the cash portion of the
consideration to be paid to the former EB stockholders from the proceeds of the
previously announced offering of U.S. $300,000,000 aggregate principal amount of
Senior Floating Rate Notes and $650,000,000 aggregate principal amount of 8%
Senior Notes, which were released out of escrow in connection with the closing
of the business combination, and excess cash.
In connection with the transaction, GameStop also announced that it is entering
into a $400 million senior secured revolving credit facility, which expires in
October 2010. Borrowings under the revolving credit facility will be limited by
an eligible inventory borrowing base, defined as the lesser of (x) approximately
70% of non-defective inventory, or (y) 90% of the net appraised inventory
liquidation value, plus, in each case, 85% of eligible credit card receivables
less certain reserves. Loans incurred under the credit facility will be
maintained from time to time, at GameStop's option, as: (1) Prime Rate loans
which bear interest at the prime rate (defined in the credit facility as the
higher of (a) the administrative agent's announced prime rate, or (b) 1/2 of 1%
in excess of the federal funds effective rate, each as in effect from time to
time); or (2) LIBO Rate loans bearing interest at the LIBO Rate for the
applicable interest period, in each case plus an applicable interest margin
ranging from 0% to 1.75% based on GameStop's consolidated leverage ratio. In
addition, GameStop is required to pay a commitment fee for any unused amounts of
the revolving credit facility, currently ranging from 0.375% to 0.50%, based on
GameStop's consolidated leverage ratio. Any borrowings under the revolving
credit facility are secured by the assets of GameStop and its direct and
indirect wholly-owned domestic subsidiaries, which are co-borrowers. Under
certain circumstances, the revolving credit facility may restrict GameStop's
ability to pay dividends.
ABOUT GAMESTOP CORP.
Headquartered in Grapevine, TX, GameStop Corp. (NYSE:GME) (NYSE:GME.B) is one of
the nation's largest video game and entertainment software retailers. The
combined company operates over 4,200 retail stores throughout the United States,
Australia, Canada, Denmark, Finland, Germany, Italy, Ireland, New Zealand,
Norway, Puerto Rico, Spain, Sweden, Switzerland and the United Kingdom. In
addition, the company owns commerce-enabled Web properties, GameStop.com and
ebgames.com, and Game Informer(R) magazine, a leading video and computer game
publication. GameStop Corp. sells the most popular new software, hardware and
game accessories for the PC and next generation video game systems from Sony,
Nintendo, and Microsoft. In addition, the company sells computer and video game
magazines and strategy guides, action figures, and other related merchandise.
General information on GameStop Corp. can be obtained via the Internet by
visiting the company's corporate Website:
http://www.gamestop.com/investor-relations/.
SAFE HARBOR
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements include, but
are not limited to, statements about the benefits of the business combination
transaction involving Historical GameStop and Electronics Boutique, including
future financial and operating results, GameStop's plans, objectives,
expectations and intentions and other statements that are not historical facts.
Such statements are based upon the current beliefs and expectations of
GameStop's management and are subject to significant risks and uncertainties.
Actual results may differ from those set forth in the forward-looking
statements.
The following factors, among others, could cause actual results to differ from
those set forth in the forward-looking statements: the risk that the businesses
of Historical GameStop and Electronics Boutique will not be integrated
successfully; the risk that the cost savings and any other synergies from the
transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain
relationships with customers, employees or suppliers; and competition and its
effect on pricing, spending, third-party relationships and revenues. Additional
factors that could cause GameStop's results to differ materially from those
described in the forward-looking statements can be found in the Annual Reports
on Forms 10-K/A of Historical GameStop and Electronics Boutique for the fiscal
year ended January 29, 2005 and GameStop's Form S-4 filed in connection with the
business combination filed with the SEC and available at the SEC's Internet site
at http://www.sec.gov.