EBay formally rejected GameStop’s unsolicited takeover offer on Tuesday. This bid rejection came after careful review by the San Jose company’s board. GameStop had proposed a 56 billion dollar acquisition of the online marketplace. The video game retailer offered 125 dollars per share in cash and stock. That price represented a 46 percent premium over eBay’s February closing price.
EBay’s board explained its decision in a detailed statement. The bid rejection reflected concerns about growth and profitability impacts. The board expressed full confidence in its current management team. EBay believes it can drive sustainable growth without outside intervention. Therefore, the company will continue executing its existing strategic plan. The board emphasized delivering long-term shareholder value independently.
Moreover, this bid rejection deals a major blow to GameStop’s ecommerce ambitions. The Texas-based retailer wanted to challenge Amazon and other larger rivals. GameStop CEO Ryan Cohen had planned to grow eBay’s collectibles business. Nevertheless, analysts expressed serious doubts about financing such a huge deal. GameStop’s market cap stands at just 10 billion dollars currently. Meanwhile EBay’s market value reaches approximately 48 billion dollars. Consequently, many experts questioned how GameStop could afford this purchase.
Cohen revealed financing details in a recent CNBC interview. He said GameStop would offer half cash and half stock for the deal. Investment bank TD Securities expressed high confidence in raising 20 billion dollars. However, questions still swirled about competing with Amazon effectively. GameStop has struggled with the rise of online shopping recently. The company closed roughly 470 stores nationwide in January alone. Its fiscal 2025 revenue fell 5 percent to 3.63 billion dollars.
The bid rejection may lead GameStop to take a different approach. Cohen told the Wall Street Journal he might go directly to shareholders. He would pursue that strategy if EBay remained unwilling to negotiate. Meanwhile EBay continues its own transformation efforts independently. The company plans to acquire Depop from Etsy for 1.2 billion dollars. EBay also announced layoffs of 800 workers, or 6 percent of staff. Following the bid rejection, EBay shares rose 2 percent to 110 dollars. GameStop stock fell more than 3 percent to roughly 22 dollars. Analysts will watch for any hostile takeover attempt in the coming weeks.
