eBay Closes the Door on GameStop: Board Deems Offer 'Neither Credible Nor Attractive'

The board of directors of eBay has officially rejected the acquisition proposal put forward by GameStop, deeming it "neither credible nor attractive." The decision was communicated by eBay's board chairman, Paul Pressler, through a letter seen by Bloomberg, which highlights strong concerns about the financial sustainability of the operation.

The U.S. chain specialized in video game retail had made an offer of $56 billion, equivalent to $125 per share, with a premium of about 20% over eBay's current stock price. The operation was expected to have a mixed structure composed of half cash and half GameStop shares.

However, the main critical element concerns the economic size of the acquisition. GameStop has a market capitalization of approximately $11 billion, compared to eBay's approximately $45 billion. To complete the operation, the company led by Ryan Cohen would have had to rely on substantial debt, including a financing plan of at least $20 billion. According to reports, Cohen did not provide convincing details about the additional capital sources necessary to support the acquisition.

In justifying the rejection, eBay emphasized its operational and financial solidity, recalling the turnaround it has completed in recent years to strengthen its competitiveness against rivals like Amazon. Pressler also highlighted how the company continues to generate returns for shareholders through growth in fee-related activities, advertising, and payment management.

Currently, eBay has around 136 million active users, with annual transactions of about $80 billion. In the last fiscal year, the platform recorded revenues of $11.6 billion.

The board's rejection could now open the door to a more aggressive scenario. Ryan Cohen had already stated that, in the event of a failure to reach an agreement with the board, GameStop could proceed with a hostile offer directly to shareholders or attempt a proxy fight to replace part of the board with members favoring the operation.

The interest in eBay is part of GameStop's strategic transformation. The company, which became famous in 2021 during the phenomenon of "meme stocks" and the short squeeze that caused extreme fluctuations in its stock price, has long been seeking to diversify its business beyond traditional video game and collectible sales.

In recent months, GameStop has abandoned the NFT segment to focus more on retro gaming and classic systems, from NES to PS Vita. Meanwhile, the company has closed over 400 stores in the United States in an effort to reduce operating costs and improve its market capitalization.

According to rumors published by the Wall Street Journal, Ryan Cohen could also receive up to $35 billion in shares if he manages to bring GameStop's market capitalization to $100 billion. In this context, the acquisition of eBay would have been interpreted by some analysts as a potential acceleration in the company's evolution towards a model closer to major e-commerce platforms.