GameStop Offers $55.5 billion to Acquire eBay
GameStop has made a $55.5 billion offer on Monday to buy eBay, with the video game retailer’s Chief Executive saying the move could create a strong competitor to Amazon.
The offer is $125 per share for eBay, with half in cash and half in stock, representing a 46% premium to eBay’s Feb. 4 closing share price. That was the date GameStop accumulated a 5% stake in the e-commerce giant.
“It makes us one of the largest shareholders. So they have a fiduciary duty to their shareholders to evaluate this proposal,” GameStop CEO Ryan Cohen told CNBC on Monday.
“This is a business that is under-earning and can make a lot more money. And GameStop is a good blueprint for that.” Cohen wrote in a letter to eBay’s chair that a buyout would benefit both companies.
“GameStop, with approximately 1,600 U.S. locations, gives eBay a national network for authentication, intake, fulfilment, and live commerce,” Cohen wrote.
The Board of Directors for eBay confirmed Monday morning that they had received the “unsolicited, non-binding acquisition proposal” and will evaluate it.
The statement urged eBay stockholders not to take any action at this time. Cohen told the Wall Street Journal that eBay “could be a legit competitor to Amazon” if the takeover attempt succeeds.
He said his proposed plans for eBay include cost-cutting measures and a focus on live commerce, in which brands use live video streams to sell directly to consumers. PayPal Stablecoin Hits $3.4bn on Surging Transactions Volume