The online marketplace eBay turned down GameStop’s \$55.5 billion bid, a move that significantly dampened the video game retailer’s aspirations to establish an Amazon competitor.
Following review of GameStop’s proposal, eBay’s board concluded the offer was “neither credible nor compelling,” stated eBay Chairman Paul Pressler in a letter to GameStop CEO Ryan Cohen on Tuesday. In the letter, obtained by CNN, Pressler outlined that the board made its decision after weighing eBay’s “standalone prospects,” the “uncertainty” surrounding the deal’s financing, and GameStop’s “governance and executive incentives,” among other factors.
CNN reached out to GameStop for comment. The company’s stock saw a 4.5% decline during pre-market trading.
GameStop’s ambitious bid, nearly four times its size, had already generated considerable scrutiny, especially given the vague details on how Cohen intended to finance the purchase, a topic he seemed to sidestep in an interview with CNBC.
In a curious turn, it emerged that Cohen was listing items for sale on eBay—purportedly to fund the acquisition of eBay. Among the items advertised were a GameStop hat priced at \$4,950 and a matching mug for \$3,151.
GameStop’s extravagant proposition emerged amidst something of a resurgence at eBay, which is striving to reimagine itself facing escalating rivalry from entities like Walmart, Amazon, Shein, and Facebook Marketplace. The company’s stock price has appreciated by 24% this year.
Pressler noted that eBay, under its current leadership, is “well-positioned for continued sustainable growth… and to deliver long-term value to our shareholders.”
“eBay is a strong, resilient business that has delivered meaningful results over the past several years,” he remarked. “We have sharpened our strategic focus, strengthened execution, improved our buyer and seller experiences, and consistently returned capital to shareholders.”
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