GameStop said it has stopped an effort to sell itself, citing a lack of available financing at terms a buyer would find acceptable. The shares (GME) tanked 22% in early U.S. trading.
The retailer started a strategic review in June and sold its Spring Mobile business as part of that process. GameStop said it is continuing its search for a permanent chief executive officer.
It’s another disappointment for investors who hoped for a sale as a way out. GameStop, the world’s largest independent video-game retailer, has been struggling to insulate itself from shrinking brick-and-mortar sales of games like Call of Duty. With physical video games out of vogue in the digital age, there weren’t a lot of strategic merger partners left for the company. That left private equity firms as the most obvious bidders—Apollo and Sycamore Partners had been cited by the Wall Street Journal as potential acquirers.
The shares had already tumbled Monday on news that Apple (AAPL) plans to launch a subscription video-game service, indicating that competition is only intensifying for the beleaguered retailer.