\n<\/p>\n
The board of eBay has rejected the US video games retailer GameStop\u2019s surprise $55.5bn bid (\u00a341bn) for the online marketplace, describing the proposal as \u201cneither credible nor attractive\u201d.<\/p>\n
Earlier this month, GameStop made an unsolicited bid for eBay, publishing a letter on its website outlining a half-cash, half-stock proposal.<\/p>\n
This was despite the US games company \u2013 which became a global household name during the meme stock craze of 2021 \u2013 being worth far less than its takeover target. GameStop had a market valuation of roughly $12bn before its bid, almost a quarter of eBay\u2019s $46bn valuation.<\/p>\n
GameStop\u2019s shares have fallen by more than 12% since releasing its takeover offer, particularly after the company\u2019s chief executive, Ryan Cohen, failed to explain how the retailer could afford the deal during a television interview on CNBC.<\/p>\n
In a letter to Cohen published on Tuesday, eBay\u2019s chair, Paul Pressler, said its board and advisers had reviewed GameStop\u2019s proposal and \u201cdetermined to reject it\u201d.<\/p>\n
Pressler said eBay had taken into account uncertainty around GameStop\u2019s financing proposal as well as its borrowing and the operational risks of a combined group.<\/p>\n
Cohen has previously said GameStop was prepared to launch a hostile bid and take the offer directly to eBay\u2019s shareholders if the board was not receptive to his proposal.<\/p>\n
GameStop has built up a stake of 5% in eBay and is offering to acquire the company at $125 a share, using about $9.4bn in \u201ccash on hand\u201d and $20bn in potential debt financing from TD Securities. Adding GameStop\u2019s market capitalisation of just over $10bn, the total remains about $16bn short of what it offered in its unsolicited bid.<\/p>\n
During the CNBC interview, Cohen dodged questions over how the company would make up the funds needed to close the deal, saying he did not \u201cunderstand the question\u201d.<\/p>\n
Cohen, who has been involved with GameStop since 2020, has said the online marketplace could be worth much more under his leadership, vowing to launch an immediate cost-cutting plan and turn it into what he describes as a \u201clegit competitor to Amazon\u201d.<\/p>\n
During the Covid pandemic, a meme-fuelled \u201crevolution\u201d in investing led to gen Z and millennial investors piling into the stocks, including GameStop, in a frenzy that pushed a number of hedge funds close to bankruptcy.<\/p>\n
Those investors sent GameStop shares up from $3.25 in April 2020 to $347.50 in late January 2021 \u2013 a rise of 10,692%. They piled into the stock just as hedge funds started betting against the company after the doldrums of the pandemic, when gamers were moving online.<\/p>\n
While GameStop has since shut hundreds of stores, including 590 in 2025, Cohen said the 1,600 remaining sites would offer eBay a \u201cnational network for authentication, intake, fulfilment, and live commerce\u201d.<\/p>\n
Ebay, which was launched in 1995, is in the process of acquiring the British secondhand fashion resale app Depop from Etsy for about $1.2bn in cash, in an effort to target younger, fashion-loving consumers.<\/p>\n
GameStop has been contacted for comment.<\/p>\n","protected":false},"excerpt":{"rendered":"
The board of eBay has rejected the US video games retailer GameStop\u2019s surprise $55.5bn bid (\u00a341bn) for the online marketplace, describing the proposal as \u201cneither credible nor attractive\u201d. Earlier this month, GameStop made an unsolicited bid for eBay, publishing a letter on its website outlining a half-cash, half-stock proposal. This was despite the US games<\/p>\n","protected":false},"author":1,"featured_media":49358,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[24426,22550,1532,9107,10783,24501,17244],"class_list":{"0":"post-49357","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-55-5bn","9":"tag-attractive","10":"tag-bid","11":"tag-credible","12":"tag-ebay","13":"tag-gamestops","14":"tag-rejected"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/49357","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=49357"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/49357\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/49358"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=49357"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=49357"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=49357"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}