GameStop, adopted by Reddit-powered day traders, is undergoing a major management shake-up, with CEO George Sherman stepping down on or before July 31.
GameStop Corp’s George Sherman will step down as CEO in the video game retailer’s biggest reshuffle, giving major shareholder Ryan Cohen more control as he leads the company’s transition to e-commerce.
Shares of the company, which were at the heart of a Reddit-led trading frenzy, jumped 9% in pre-market trading on Monday after GameStop announced that Sherman would resign on or before July 31 and began to look for a successor.
Reuters previously reported that GameStop’s board of directors was working with an executive headhunter on CEO search and that its directors spoke to potential candidates from the games, e-commerce and tech industries.
GameStop also said Sherman refused to receive compensation for his role as a director, both before and after the separation date, and agreed to cancel his award of restricted stock vested at the 2020 performance.
Sherman has already lost more than 587,000 shares for failing to meet his performance targets, a regulatory filing showed last week.
Sherman’s decision to step down comes as Ryan Cohen, co-founder and former CEO of online pet food company Chewy Inc, tightens his grip on GameStop after taking the presidency earlier this month. Cohen’s RC Ventures owns nearly 13% of GameStop, according to data from Refinitiv.
Former GameStop CFO Jim Bell and former chief clientele Frank Hamlin are among the senior executives who have left the company in recent weeks.
GameStop is transforming into an ecommerce business capable of competing with large retailers like Walmart Inc, as well as tech companies like Microsoft Corp and Sony Corp.
Separately, Bloomberg reported that the man known as the “Roaring Kitty” on social media, whose online posts helped spark the January trading spree on GameStop, exercised call options on the share to acquire an additional 50,000 shares at an exercise price of $ 12.