GameStop Says it Will Sell its Spring Mobile Division for $700 Million

Video game retailer GameStop saw its shares explode on the news that the company will be selling its Spring Mobile division for $700 million. Shares gained 15% on the announcement.

According to the company, the sale will provide it immediate cash and allow it to focus more on entertainment and collectibles.

The buyer is Prime Communications, L.P., which owns and operates 1,289 AT&T wireless stores, according to a press release. The deal is expected to close in the fourth quarter of fiscal 2018.

The press release also noted that the deal is a park of a larger review of “a wide range of strategic and financial alternatives to enhance shareholder value.”

“This transaction enables GameStop to enhance our performance with an increased focus on the video game industry and the rapidly-growing collectibles space. These are areas where we have considerable experience and where we are well positioned to capitalize on our competitive position,” said Executive Chairman of GameStop’s board of directors Dan DeMatteo.

He added, “Our board continues to review strategic and financial alternatives to enhance shareholder value and we look forward to providing an update on the process at the appropriate time.”

Disclaimer: We have no position in GameStop Corp. (NYSE: GME) and have not been compensated for this article.