GameStop CFO set to leave with US$30m package after Reddit-driven stock rally

Shares of GameStop fell about 5 per cent to US$42.75 in extended trading after the announcement. PHOTO: AFP

NEW YORK (BLOOMBERG, REUTERS) - Jim Bell, the GameStop chief financial officer who is being pushed out after less than two years on the job, won't be leaving empty-handed.

The executive will get US$15.8 million (S$20.8 million) when he departs, which is set for next month, and he could earn millions more from equity in coming years if activist investor Ryan Cohen can pull off a turnaround of the video-game retailer.

While the terms of Mr Bell's payout are fairly standard for a departing executive, the value of his potential exit package is high - partly a product of the GameStop rally in January that's left the stock worth more than double what it was at the end of 2020.

Mr Bell's contract entitles him to US$2.8 million in severance and an immediate payout of restricted shares worth US$13 million when he departs, according to regulatory filings and calculations by Bloomberg News.
He also holds a couple of equity awards that are tied to goals spanning several years. Filings show he could collect at least 300,000 shares, depending on how the company does. They were worth US$13.8 million as of Tuesday's close in New York.

GameStop said Mr Bell's resignation was not due to any disagreement with the company relating to its operations, including accounting principles and practices.

However, a source said that while Mr Bell's exit was unrelated to the recent wild swings in GameStop's stock spurred by retail traders on the Reddit social media site, his departure was initiated by the company.

Mr Cohen, the billionaire co-founder of pet-supply company Chewy, has pushed GameStop to rethink its business and compete with more directly. He's the company's second-largest shareholder and won three board seats in January.

The company is now seeking a finance chief who is more in line with that vision, a person familiar with the situation said on Tuesday (Feb 23). Mr Bell, who was hired in June 2019, is slated to leave by March 26.

Mr Bell's departure from GameStop will be his third exit from a company in less than five years, according to his LinkedIn profile. He previously worked at brick-and-mortar retailers Gap and Coldwater Creek and restaurant chain P. F. Chang's China Bistro, according to the profile.

Shares of GameStop fell about 5 per cent to US$42.75 in extended trading after the announcement. The stock has risen about 140 per cent this year, after paring most of the gains that sent short sellers scrambling to cover losing bets and saw the company hit a record high of US$482.95.

GameStop said it has begun a search for a permanent CFO, adding that it would appoint chief accounting officer Diana Jajeh as interim CFO if a permanent replacement was not found before Mr Bell's departure.

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