GameStop Names 3 New Directors in Deal With Activist Investor

GameStop named three new directors, in an accord with an activist investor, and it said that holiday same-store sales rose.
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GameStop shares rose as the videogame retailer named three new directors, in an accord with an activist investor, and it estimated that same-store holiday sales rose.

The Grapevine, Texas, chain's agreement with RC Ventures places three of the New York activist investor's nominees -- Alan Attal, Ryan Cohen and Jim Grube -- on the board.

RC Ventures is GameStop's second-largest shareholder, with a 13.8% stake, according to FactSet. 

A statement from GameStop said the three executives have "deep expertise in e-commerce, online marketing, finance and strategic planning."  

Adding them to the board "will help us accelerate our transformation plans and fully capture the significant growth opportunities ahead for GameStop," said GameStop Chairwoman Kathy Vrabeck. 

Vrabeck and three other board members -- Lizabeth Dunn, Raul Fernandez, James K. Symancyk -- said they do not intend to stand for reelection at the annual meeting.

So through the annual meeting, the board has 13 members. After the meeting, membership drops to nine.

“We are excited to bring our customer-obsessed mindset and technology experience to GameStop and its strategic assets," Cohen said in a statement. 

"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." 

Cohen, who manages RC Ventures, founded and was CEO of the pet-products provider Chewy  (CHWY) - Get Report. He led the company through its $3.3 billion sale to PetSmart. 

Separately, GameStop said that for the nine-week holiday season ended Jan. 2, comparable-store sales rose 4.8% and e-commerce sales quadrupled.

Worldwide sales eased 3.1% to $1.77 billion due to an 11% decrease in the company's store base in the period.

"Demand for the new generation of consoles remains very strong, and as a result, we anticipate the consumer’s excitement for the new console technology will benefit us going forward well through 2021," GameStop Chief Executive George Sherman said in a statement.

Update: On Wednesday, shares of GameStop at the last check jumped 40% to $27.99.