GoPro stock GPRO has surged in recent sessions after the struggling action-camera maker announced a $285 million cash merger with Starman Optical, a privately held photonics company.
Earlier, YouTube creator Mark Fischbach, better known as Markiplier, revealed an 8.5% stake in the company, making him the single largest stakeholder in the company.
GoPro shares have rallied sharply as investors reacted to both developments.
The stock has gained nearly 200% in the week so far and has gained 26% on Friday.
The 200% surge includes a 40% surge on September 1 when the Starman deal was announced.
The stock was trading around $1.75, above Starman’s $1.14-per-share offer.
The developments mark a significant turnaround in investor interest for a company whose stock has lost about 96% of its value since reaching a valuation of $4 billion on its first trading day in 2014.
Markiplier becomes GoPro’s largest shareholder
Markiplier acquired an 8.5% stake in GoPro, making him the largest single shareholder in the camera company.
He revealed the stake in the company through a Schedule 13G filing dated August 20.
In an interview with Bloomberg, Fischbach said he had been interested in GoPro because he believed its shares were undervalued. He also said he wanted the company to succeed.
Fischbach has described the investment as part of a broader effort to make filmmaking more accessible. He has also invested in Strada, a company that provides tools for filmmakers to transfer large files.
The investment quickly attracted attention from retail traders.
GoPro has been a heavily shorted stock in the past, and its sharp rally following Markiplier’s disclosure has renewed interest among meme-stock traders.
$285 million Starman Optical merger
GoPro’s rally accelerated after the company announced a definitive merger agreement with Starman Optical.
Under the transaction, Starman will pay GoPro shareholders $285 million in cash, or $1.14 per share. Starman would receive a 90% stake in the combined company, while existing GoPro shareholders would retain the remaining 10%.
The transaction is expected to repay GoPro’s roughly $92 million of outstanding debt when it closes. GoPro is also expected to remain publicly listed on the Nasdaq, with the deal targeted for completion by the end of the year.
Starman makes optical transceivers in the US for use in AI data centers.
The merger is intended to give GoPro exposure to commercial, defense and AI markets while allowing it to make greater use of its more than 2,500 US patents, including those related to optics and imaging.
Starman will also add optical transceivers to GoPro’s product portfolio.
The companies said they would seek to bring production of some important optical equipment back to the US, although they did not provide a timeline.
GoPro CEO Nicholas Woodman said the merger is expected to allow the company to expand across consumer, commercial and defense markets while becoming an American imaging and optical solutions company.
GoPro faces major challenges despite stock rally
The sharp rise in GoPro shares comes after years of deterioration in the company’s market value and financial position.
GoPro debuted in 2014 at $38 a share and reached a valuation of about $4 billion on its first trading day.
Since then, the stock has lost around 96% of its value as the company faced growing competition from Chinese rivals including DJI and Insta360.
The company’s revenue has also fallen substantially from its peak. Revenue in the June quarter was down more than 80% from the $633.91 million recorded in the final quarter of 2014.
More recently, higher memory chip prices linked to the expansion of AI infrastructure have added pressure on GoPro.
The company warned in June that there was substantial doubt about its ability to continue as a going concern over the next 12 months.
GoPro said it will continue supporting its existing consumer products, subscriptions and cloud platform while investing in a broader product roadmap.
The company therefore does not plan to abandon its action-camera business as it expands into new markets through the Starman transaction.
The merger announcement also comes after GoPro said in May that its board was exploring strategic alternatives.
The stock’s recent rally has pushed the company back into the spotlight, with Markiplier’s investment providing a catalyst for retail interest and the Starman transaction offering a potential path into AI infrastructure and defense markets.
However, the company continues to face financial and competitive challenges, while the proposed merger remains subject to its closing conditions.
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