Shares of GameStop Corp. GME, +0.96% were indicated up nearly 1% in premaket trade Thursday, after shareholders Hestia Capital Partners L.P. and Permit Capital Enterprise Fund L.P. urged the video games retailer to tender up to $700 million worth of its stock and bring in new board members. Based on Wednesday’s stock closing price of $11.20, the proposed tender amount would represent about 61% of the shares outstanding. Hestia and Permit, which combined own 1.3% of GameStop shares outstanding, sent a letter to the company’s board sharing concerns regarding the “dramatic underperformance” of the stock. They said they believe a fair value of the company is “at least” $19 per share, which is 70% above Wednesday’s closing price. The shareholders urged the company to return a significant portion of its cash, which they estimate to be about $1.5 billion as of the end of fiscal 2018, to shareholders. The stock has tumbled 27.6% over the past 12 months, while the SPDR S&P Retail ETF XRT, +0.29% has gained 1.0% and the S&P 500 SPX, +0.69% has tacked on 2.2%.
Have breaking news sent to your inbox. Subscribe to MarketWatch’s free Bulletin emails. Sign up here.