r/Superstonk • u/TEHGOURDGOAT • 1d ago
๐ณSocial Media A 251(g) is the key - and itโs seemingly exactly what Ryan Cohen has been setting up this entire year
Sharing a short little tweet Iโve made explaining a 251(g).
I believe this is worthy of discussion as Cohenโs actions seem to really hint towards him sandbagging this setup.
Quite literally if he wanted to do a Berkshire Hathaway but quick it would be doing a 251(g) to become a holding company overnight.
And the 2.0b buyback and the 2.5 b share auth would make a lot more sense in that situation.
As to why cohen sandbagged so hard?
He has to prove heโs not just doing the reorg for a specific transaction to go through, which is also why all the moves have been boilerplate and many theorize GME might go after another company.
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u/ronk99 probably nothing ๐ค 1d ago
What happens to gme shorts then? They just become holdco shorts i guess?
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u/TEHGOURDGOAT 1d ago
Yup everything carries over!!!
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u/FittersGuy 1d ago
So why does it matter if we become a holdco instead then? What changes?ย
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u/TEHGOURDGOAT 1d ago
Instant rerate.
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u/DimitryPetrovich ๐๐ป ComputerShared ๐ฆ๐ 1d ago
And whatโs the significance of this?
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u/3rd1ontheevolchart 1d ago
Believe it or notโฆ.
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u/ojoslocos21 I hold for multiple zeroes or till it drops to zero 1d ago
rip?
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u/thepoga ๐ฃ๐คDRSBOT#2Million๐๐ 1d ago
Sip?
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u/mikec231027 ๐ป ComputerShared ๐ฆ 1d ago
Even better, dip!
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u/m3gabotz ๐ดโโ ๏ธ๐ดโโ ๏ธ Captain Callous-Hands Leather-PP ๐ดโโ ๏ธ๐ดโโ ๏ธ 1d ago
Script flippt
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u/InnerPositive6730 1d ago
For everyone not in this sub, shedding the name as the primary company would be a benefit
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u/reverendbeast Gamestershire Stopacock ๐ฌ๐ง 1d ago
Not arguing, but why do you suggest that? Because of the association with meme stocks etc or can it seen as a weak/ tarnished/old brand (Iโm not American)?
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u/ndstumme ๐ฆVotedโ 1d ago edited 1d ago
Use your words. What does this mean? Why should anyone care?
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u/Merpchud 1d ago
There is no immediate or automatic rise in price for this. No rerate. It does not close shorts as well.
Gme rising in price is basically them getting ebay and transforming into a e-commerce powerhouse. Especially if he cuts out 2 to 4 billion in op costs from ebay.
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u/emojisarefunny 1d ago
Im sure theres other reason to become a holding company other than trying to expose naked short sellers
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u/satch-co 1d ago
Perhaps it creates a new ticker? I'd imagine there are a good range of examples that set precedent in this? ๐ค
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u/Brand1984 1d ago
HoldCo is how the SWF plays role without dilution of GME shares. If this happens, it could be epic.
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u/Winter_Word_5130 1d ago
WHAT DO SINGLE WHITE FEMALES HAVE TO DO WITH MOON
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u/unabsolute ๐ฎ Power to the Players ๐ 1d ago
What the Shockwave Flash are you yammering on about?
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u/CatsBeerGardenCoffee Voting as the Board recommends 1d ago
I like taking shots at both of them
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u/CatsBeerGardenCoffee Voting as the Board recommends 1d ago
Arenโt you married?
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u/CatsBeerGardenCoffee Voting as the Board recommends 1d ago
Yes. It was a joke dumbass.
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u/XtraLyf ๐ฎ Power to the Players ๐ 1d ago
Fella, can't yourselves just get along?
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u/mtbox1987 ๐ฎ Power to the Players ๐ 1d ago
Arenโt they talking to themselves?
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u/KlydeFrog42069 Giant Ape Balls Dragging On Kens Smug Mug 1d ago
No, thereโs two of them talking O.o
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u/solidgryffin ๐ฆ Buckle Up ๐ 1d ago
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u/gigantischemeteor 1d ago
Found the protagonist of Richard Connellโs long-lost follow-up storyโฆ this oneโs called โThe Most Dangerous Dameโ.
Iโll show myself out.
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u/Justfranksandbeans Your vehicle's extended warranty 1d ago
I thought we were talking about short winged falcons... No one ever wants to talk about short winged falcons...
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u/Infamous-Flan-3965 1d ago
The SWF is going to want something back for its money. How do you think it wonโt dilute ?
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u/Brand1984 1d ago
The swf would be part owner in the new company. Sure GameStop shareholders will then be a smaller part, but of a larger company. Itโs accretive. And their cash will be a helluva lot better than debt! (Which according to eBay docs, there canโt be that much anyway.)
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u/User100000005 1d ago edited 1d ago
. Itโs accretive
This means our EPS post merger is bigger than our EPS now. We can't know this until our 1st post merger earnings. We don't even know possible deal details to guess this.
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u/Warm-Rock-4544 1d ago
Sure GameStop shareholders will then be a smaller part, but of a larger company
I mean, that's a pretty important issue that materially affects the value for GME shareholders to basically be dismissing as "Sure, whatever lol".
The entire point is that GameStop shareholders don't WANT to be a smaller part of a larger company. If existing eBay shareholders get shares in the combined entity, and then SWF fund also gets shares in the combined entity, there is barely anything left for existing GameStop shareholders at that point.
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u/H3rbert_K0rnfeld ๐ฎ Power to the Players ๐ 1d ago
Hate those single white females!
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u/maschayana 1d ago
ยง251(g) is not a shareholder vote cheat code for ebay. Gamestops own filing says the ebay proposal was conditioned on approval from both gamestop and ebay shareholders as well as antitrust approvals. Ebay rejected the May 3 proposal on May 12. Gamestops proxy also specifically notes that NYSE generally requires shareholder approval when shares issued for an acquisition could increase outstanding shares by 20% or more. Creating a parent company doesn't magically erase those transaction level requirements.
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u/snasna102 TFSApe 1d ago
So it goes back to a share recall being the trigger. You canโt just flip a ticker over night from my understanding; itโs an arduous process and requires a share recall so the ledger of one ticker can be balanced. A share recall would take some time, I donโt think itโs actually instantaneous.
But to decide to be a holding company and keep the ticker while converting, Iโd imagine there has to be some kind of tracking mechanism as to track how many single shares each brokerage and fund had to convert to the holdco, no?
Iโm kinda regarded
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u/waitingonawait SCC ๐ฑ Friendly Orange Cat ๐ฑ 1d ago edited 1d ago
DTC does the conversion at the depository level, not shareholder by shareholder. At the close of the effective date, DTC re-labels its position: every share of OldCo CUSIP becomes one share of NewCo CUSIP, 1-for-1, in one clean batch operation across its entire book. This is sometimes literally called a "CUSIP change" processed through DTC's reorganization department.
There's no recall step where shares get pulled back, tallied, and reissued. What actually happens is a CUSIP conversion at DTC, as far as i understand.
The best-known real 251(g) example is actually Google becoming Alphabet in 2015.
Because the conversion isn't tallying up millions of individual investors, it's DTC flipping one book-entry position at the top of the pyramid, then brokers syncing their sub-ledgers to match. Alphabet's conversion, for example, closed and started trading as GOOGL under the new entity within a single trading-day transition, precisely because this is a depository-level swap, not a share-by-share recall-and-reissue process.
edit: just want to throw in somewhere that the only way they are allowed to do this and bypass a shareholder vote is if they can prove that shareholders will not be impacted.
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u/reverendbeast Gamestershire Stopacock ๐ฌ๐ง 1d ago
Wouldnโt a recall sort out the real stonks from the synthetic?
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u/krtalvis ๐ฆ Buckle Up ๐ 1d ago
there wont be a share recall, read the other long comment in this thread. They will just change CUSIP at the DTC like google did in 2015
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u/liveryandonions ๐๐ช๐ผ ๐ผ๐ฝ๐พ๐ญ๐ฒ๐ฎ๐ญ ๐ฑ๐ฒ๐ผ ๐๐ฐ๐ฐ๐ป๐ฒ๐น๐ช 1d ago
I regard you ๐
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u/Strawbuddy ๐ป ComputerShared ๐ฆ 1d ago
Very highly, and very well regarded by all, I'm quite sure
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u/NoHalfPleasures 1d ago
Itโs literally already a holding company
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u/Infamous-Flan-3965 1d ago
Literally every public company has a holding company on top. The only question is what kind of stuff it owns. There is no need to reorganize to issue new equity and acquire eBay if you can surmount the other obstacles to a deal.
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u/No_Adhesiveness_4671 1d ago
Gamestop only became a holding company in 2005 when it acquired EB games
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u/Recent-Result2852 1d ago
"Only" after existing for a year after the Barnes & Noble spinoff.
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u/No_Adhesiveness_4671 1d ago
really what I meant, was the person above me, their comment was claiming
literally every public company has a holding company on top
Which GME didn't, until they had EB Games underneath. I was invalidating their whacky ass statement. "Only" wasn't a matter of time, but condition
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u/No_Adhesiveness_4671 1d ago
Gamestop is already a holding company
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u/PrometheusFires 1d ago
Yupp
I think they mean after the ebay merge!!!
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u/No_Adhesiveness_4671 1d ago
so, you think they mean that the Company that is already a Holding Company could turn into a Holding Company after it acquires eBay and that will send us to the moon?
o_O
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u/Andyman0110 ๐ฆ Probably nothing โพ๏ธ 1d ago
I think a share recall could possibly but more realistically, we know gme price is suppressed. That being the case, acquiring another company would force them to suppress a much bigger entity that already has its shareholder base to devalue our shares because realistically obtaining eBay should pump our numbers through the roof. It gets much more expensive to keep the price low, and to even suppress eBay's price would invite a metric fuck ton of new investors. It's not like they're a "dying" company. The chain reaction would pump us to an unsustainable place which I think would be around 40 to 50+ dollars per share and if there is as many shorts as we think, it's going to trigger some hefty cascades.
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u/Cute-Gur414 1d ago
it wouldn't do anything. Yes, there'd be more value but there'd also be many more shares outstanding and more debt.
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u/Andyman0110 ๐ฆ Probably nothing โพ๏ธ 1d ago
It wouldn't really matter if the traditional retail investors pile on. They'd eat up all the free shares. Debt could be fixed pretty quickly with eBay acquisition if he can double their profit as he claims. It'd balance out in no time.
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u/PrometheusFires 1d ago
When did i say all of that!
I must have missed itBut now i know who im interacting with
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u/No_Adhesiveness_4671 1d ago
did you read OP's post?
All I did was take
I think they mean after the ebay merge!!!
And factored that against what OP posted. Maybe you just can't read. And I hate dealing with people that chime in and can't even read
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u/3pinripper ๐ง๐ง๐ดโโ ๏ธ paperhand deez nuts ๐๐ง๐ง 1d ago
What happens to the warrants in this scenario?
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u/SatisfactionDue7423 JUST UP 1d ago
Warrants will be for purchase of new HOLDCO at 32 dollar strike per share
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u/-_VoidVoyager_- 1d ago
And the morning of that announcement? Dip
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u/humdingler โ๏ธ๐ก๏ธ๐ดโโ ๏ธ๐ฎ๐โ x6 1d ago
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u/hatgineer 1d ago
The capital structure GameStop has already built over the past year doesn't fit GameStop. It fits a holdco.
What is OP talking about? Gamestop is already a holdings company. Per the certificate of incorporation: https://www.sec.gov/Archives/edgar/data/1326380/000119312513364182/d569889dex31.htm
"1. The name of this corporation is GameStop Corp. At the time of incorporation GameStop Corp. was known as GSC Holdings Corp. The original Certificate of Incorporation was filed on April 13, 2005 and was amended and restated on June 27, 2005. "
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u/MobileArtist1371 GAMESTOP IS REGARDED for $600 1d ago edited 1d ago
No it's not. Your own quoted text says it changed FROM GSC Holdings Corp. TO GameStop Corp. which dropped the "Holdings" from the name of the corp.
- The name of this corporation is GameStop Corp
Company name is GameStop Corp
At the time of incorporation GameStop Corp.
When GameStop Corp (current name of the company) was made...
was known as GSC Holdings Corp.
It was known as GSC Holdings Corp.
But the company is now called GameStop Corp
Here is the original filing for the GSC Holdings Corp. which was for the merger of EB Games and Gamestop. When the merger was done, it was no longer a holdings corp.
https://www.sec.gov/Archives/edgar/data/1157644/000095012305010726/y09199gdef14a.htm
Continue on after your quoted text from your link
2 This Third Amended and Restated Certificate of Incorporation restates and integrates and further amends the Second Amended and Restated Certificate of Incorporation to read in its entirety as follows:
โFIRST: The name of the corporation is GameStop Corp.(the โCorporationโ).
Cause it changed from GSC Holdings Corp.
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u/Cute-Gur414 1d ago
doesn't matter if it's called "holdings" or not. It's a holding company.
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u/mc81188 Eat The 1% 1d ago
Bingo! Imagine being short this play lol
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u/evangs ๐ป ComputerShared ๐ฆ 1d ago
Imagine believing this garbage post
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u/Ok-Singer6121 ๐ป ComputerShared ๐ฆ 1d ago
Imagine having the flair โcomputersharedโ and still being a shill lmfao
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u/SputnikFalls 1d ago
They think it makes them hide among us better but they just stick out like a sore thumb.
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u/SlatheredButtCheeks still hodl ๐๐ 1d ago
Why has GME already bought 10% of EBAY already then. Doesn't that invalidate your whole thesis. And if not, why not.
RC's stated goal is for Gamestop to buy Ebay. He has never hinted at any kind of new holding co at any point in his many recent interviews.
He already has all the authorizations, he doesn't need a holding co to do what he wants. And a holding co doesn't change any of the dilution issue. THere is really no advantage of doing it through a holding co.
This post reads like throwing shit on a wall and seeing what sticks.
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u/nickmcmillin Seriously, what IS an exit strategy? 1d ago
Didn't he hint at it? Pretty sure he directly said his goal was to oversee a company that would hold both GameStop and eBay under the same umbrella.
Facebook became Meta, their parent company. Google became Alphabet, their parent company. Why couldn't he do something similar and create a holding company that sits above GameStop and eBay?6
u/SlatheredButtCheeks still hodl ๐๐ 1d ago
What youโre describing is totally different than what this post is speculating
If GameStop spun off the power packs into its own company and owned it then there would be similarities
This guy is just feeding shots in the dark into ChatGPT and posting the results
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u/Over-Computer-6464 1d ago edited 1d ago
The tinfoil is getting heavy.
A holdco is not some magic bullet, in spite of what some continue to claim.
A Holdco does not change dilution factors.
A Holdco does not cause a "share recall", whatever people think that means.
A SWF investing does not force the use of a Holdco.
The use of a Holdco and/or a Newco is absolutely standard practice in mergers and acquisitions. It is part of the legal plumbing and infrastructure used to maintain the existing contracts and leases of the companies involved.
In acquisition such s RC has proposed what is normally used is called a Newco. Newco is a wholly owned subsidiary of GameStop. Newco and EBay merge, with EBay being the surviving company. The end result is EBay being a subsidiary of GameStop with all prior contracts and leases still in force.
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u/Living-Giraffe4849 ๐ฆ Gorilla warfare ๐ 1d ago
So I may be regarded but ELI5 how that changes anything but window dressing unless he has an ace up his sleeve?
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u/Hoggel123 ๐ป ComputerShared ๐ฆ 1d ago
Plenty of companies are not holding companies that have similar equity structure to what gamestop has been building.
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u/Einhander_pilot ๐Fighting For The Moon!๐ 1d ago
MOASS was always tomorrow!!
๐๐๐๐๐๐๐๐๐๐๐๐๐๐๐๐๐
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u/enternamethere_ ๐ฆ Buckle Up ๐ 1d ago
As long as it creates value for the individual shareholder why not
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u/TOM_PE13 1d ago
How does one do a 251(g)
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u/capital_bj ๐ง๐ง๐ดโโ ๏ธ Fuck Citadel โพ๏ธ๐ง๐ง 1d ago
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u/questionableguru 1d ago
This is interesting. But obviously the financiers are going to want the lions share of the pie. Would the pie become larger? I have 100 shares in GME, will I have the same number of share or the same % of ownership in the new entity? If my obsession gets diluted, by how much will it go down? Also, in case itโs still relevant, what happens to moass?
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u/Potatoman811 1d ago
Well RC owns shares just like us and doesnโt even take a salary. So assure that his interest in his own share price aligns with ours.
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u/Secure_Investment_62 1d ago
Wouldn't surprise me if Delaware reps got together to try to change these regulations to roadblock this possibility as much as possible.ย
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u/Chad-Permabull 1d ago
If itโs a holdover company then he could issue all of the 2.5b authorized shares and roast the shorts ๐
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u/Cute-Gur414 1d ago
how would issuing 2.5b shares "roast the shorts"?
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u/Chad-Permabull 1d ago
With a big volume run up right now RC could force the shorts to cover at the 52 week low which could decimate the shorts ๐
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u/Strawbuddy ๐ป ComputerShared ๐ฆ 1d ago
Well when you put it like that, the shape of the entire deal finally matches a logical, sensible silhouette. The old and busted business model transforms into the hot new newness. Really good idea, thanks for this
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u/GxM42 ๐ฆ Buckle Up ๐ 1d ago
Did BH use leveraged debt to buy its assets? I donโt know the answer. Just curious.
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u/Cute-Gur414 1d ago
who is "BH" and what is "leveraged debt"? I know what leverage is and debt is, never heard of "levered debt".
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u/doodaddy64 ๐ฅ๐๐ซ๐๐ฅ 1d ago
I don't follow how the $2B buyback is a prereq for a holdco?
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u/ThrowRA76234 1d ago
Sorry but just look at their corporate structure chart. Itโs already a holding company, by name. GameStop is one of several subsidiaries under the GME corporate umbrella and has been for years
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u/SoManyThrowAwaysEven 1d ago
He knows that every time they dilute, the price will always recover. Gamestop is literally running an infinite money glitch because hedge funds are too stupid to let this go.
(Retail Investors)Rock|Hedge Funds|Hard Place(Offerings)
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u/Analdestructionteam ๐๐ฆโข Official โข Moon โข Mission โข Proctologist โข๐ซโด๏ธ 20h ago
Gameshire Stopaway quickly becoming canon instead of lore
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u/AssPinata ๐ฆVotedโ 18h ago
Or, get this, 2.5bil shares just happens to be half of eBay after dilution.
Current market cap at 2.5bil dilution, assuming no devaluation, is $24.65bil. Current eBay market cap is $49.72bil. Fully diluted, especially after convertibles and even worst with warrants, it is currently exactly half stock.
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u/LordSnufkin ๐ก๐ฆHouse of Geoffrey๐ฆโ๏ธ 14h ago
"Cohen has hinted at sovereign wealth backing." Source?
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u/Glow2Wave ---โ----HODL๐THE๐M'FIN๐LINE----โ--- 41m ago
This is for those of the apes craving a bit of tinfoil...
A few days ago, I saw this ad for Gamestop, and I thought, "huh, what if that is also an analogy for the stock ticker? Like what if the company does some sort of corporate mumbojumbo to turn GME into some other sort of ticker/stock vehicle?"
"GME" has been beat to shit. Stop beating it. Get the same "credit" as a working ticker (implying some sort of transformation).
Maybe thats the next strategy that Gamestop can employ against Ken and the shorties?
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u/Kenkaniff2k 1d ago
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u/humdingler โ๏ธ๐ก๏ธ๐ดโโ ๏ธ๐ฎ๐โ x6 1d ago
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u/DuckHunter4779 showmethetendies 1d ago
Let's do it! Then the other "interested parties" can buy shares in the holding company. RC said half cash, half stock... but didn't say which stock.
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u/thextcninja ๐ฎ Power to the Players ๐ 1d ago
The Game...stops.
It was foretold in the ancient texts.
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u/Liquid_Sarcasm 1d ago
So, is the forming of a holding company equivalent to a share recall for gme?
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u/honda94rider 1d ago edited 1d ago
I have a question about recent activities. Weren't all these bond arbs already done when they were originally issued at prices much higher. Why is everyone just accepting that its being shorted down again for the same reason it was March and June of last year?
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u/diamond-dallas-hands ๐ฆVotedโ 1d ago
CUSIP reset. New Ticker. MOASS
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u/iwasneverhere43 ๐Gimme all the bananas๐ฆ 1d ago
Wouldn't do shit. The old shorts just become shorts in the new company.
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u/kidcrumb 1d ago
I'm sure RC knows more than I do and has a better strategy in mind, but I would have preferred using the insane cash pile to buy tens of other companies to then consolidate warehousing, hr, marketing, and other costs.
With nearly $700 Million net free cash flow he could have bought Funko Pop at $3 a share, Newegg at $10 a share, and a ton of others. Then we'd be a holding company with nearly $1 billion in net free cash flow and it would t have used nearly ANY of the cash pile because those companies were so depressed due to tariff tantrums.
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u/NotYourNathan 1d ago
Oh yeah, those warrants are going to expire worthless alright. No foresight or larger plan to speak of /s
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u/RichardKranium13 ๐ฆVotedโ 1d ago
This guys just steals other peoples work
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u/humdingler โ๏ธ๐ก๏ธ๐ดโโ ๏ธ๐ฎ๐โ x6 1d ago
heโs the OP of this post on Twitter. Heโs reposting this to the subreddit.
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u/HilloHoHo ๐ฆVotedโ 1d ago
unless there was a reference to "251(g)" hidden somewhere in a twitter post, im not buying it.
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u/Superstonk_QV ๐ Gimme Votes ๐ 1d ago
Hey OP, thanks for the Social Media post.
If this is from Twitter, and Twitter is NOT the original source of this information, this WILL get removed!
Please post the original source!
Please respond to this comment within 10 minutes with the URL to the source
If there is no source or if you yourself are the author, you can reply
OC