Shares in GameStop slid 27 per cent on Thursday, after the video game retailer announced it was planning to issue new shares and disclosed that the US Securities and Exchange Commission was investigating trading activity in its stock.
The company, which was one of the first to become a retail-favoured so-called meme stock in January, said after markets closed on Wednesday that the SEC had contacted its staff on May 26 for assistance in an investigation into its stock activity. GameStop said it did not expect the inquiry to “adversely impact us”, and that it planned to “co-operate fully with the SEC on this matter”.
The retailer also said it planned to file a registration with the SEC for up to 5m additional shares, which, if issued, would dilute the value of the shares of current investors.