Barnes and Noble has announced that it is planning to raise $325 million by doing an initial public offering of shares in Gamestop, its game store division, citing strong current growth and expected continued growth both in the over-all videogame market and in Gamestop operations. The name of the division was recently changed to Gamestop; some may be more familiar with the names Babbages, Software, Etc., and Funcoland, other chains that the Riggios have been rolling up into one of the premier retailers of videogame software. Babbages and now Gamestop have also been significant retailers of pop culture merchandise, stocking anime and anime-related action figures, toys based on game, movie, and TV properties, as well as CCGs, RPGs, and CMGs.
Gamestop has been a stellar performer for Barnes and Noble, posting 33% same store sales increases in its most recent quarter and a 63% increase in over-all sales, to $206 million for the quarter. The purpose of the IPO is to reduce inter-company debt to the parent (paying down $250 million of a $392 total) and fund future expansion. The IPO is scheduled for October or November. Barnes and Noble will continue to own a majority of the company after the offering.
