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Hot Topic and Geeknet team up for new partnership

By Sara Ehlers

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Business

Hot Topic, Los Angeles-based apparel retailer, announced their acquirement of Geeknet Inc., online retailer company owner of ThinkGeek.

The two apparel companies agreed upon the understanding that from now on Hot Topic will acquire all of Geeknet, Inc.’s outstanding shares. Hot Topic will acquire each share at a purchase price of 17.50 dollars each. The total equity value of the transaction is approximately 122 million dollars. Hot Topic partnered with Geeknet hoping that this relationship will bring forth fresh and creative ideas for the retail company. "We are pleased to have entered into this agreement and look forward to adding Geeknet's innovative products and services to our portfolio," said Lisa Harper, chief executive officer of Hot Topic. Harper states that Geeknet’s online retail approach is strong and very fitting with Hot Topic’s long-term goals. “[We] are excited about the opportunity to help drive profitable growth and further enhance value for Geeknet’s customers,” said Harper.

Hot Topic acquires Geeknet shares

Geeknet is also hopeful for the new partnership. As a new subsidiary of Hot Topic, Geeknet believes it will be in a better position to achieve its business goals. "We remain focused on increasing our visibility, providing a platform to stimulate ideas and creativity, and expanding our product offerings to keep up with industry and customer demands,” said Kathryn McCarthy, chief executive officer of Geeknet. Geeknet’s shareholders approved of the purchase, as shareholders represent 21 percent of the company’s common stock.

Hot Topic, Inc. is a specialty retail store that offers music-themed and pop culture apparel. The company operates over 650 stores in the United States and Canada. The Los Angeles-based company is a portfolio company of Sycamore Partners, a New York-based retail private equity firm.

Geeknet, Inc. is the parent company for ThinkGeek and ThinkGeek Solutions. The premier retailer was founded in 1999. ThinkGeek offers video game-themed merchandise through various web-stores in the gaming community. The company is based in Fairfax, Virginia.

The sale is expected to commence by June 19, 2015.

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