Grapevine, Texas GameStop Corp. said Wednesday that the company agreed to buy French video game retailer Micromania for $700 million in cash, including the assumption of debt.
Under the deal, GameStop will buy the company's outstanding shares from private-equity fund L Capital. The acquisition will be funded by cash on hand from an existing revolving credit facility, as well as by a $150 million committed term loan from Bank of America.
GameStop said that the purchase of Micromania—which has 332 locations in France—will give it its first stores in that country and boost its total number of European stores to over 1,077.
GameStop's total store count will rise to 5,889 locations.
GameStop expects the deal to close in November, and said it expects the acquisition to add to its per-share earnings in the fourth quarter of fiscal 2008 and in fiscal 2009.