eBay Rejects GameStop’s $56 Billion Acquisition Bid

eBay has officially rejected GameStop’s offer to buy the online marketplace for $56 billion, citing concerns around “operational risks” and how the acquisition will be financed.

In a letter to GameStop CEO Ryan Cohen on Tuesday, eBay's board of directors said it has “concluded that your proposal is neither credible nor attractive.”

The board listed multiple factors in its assessment. These include 1) eBay’s standalone prospects, 2) the uncertainty regarding your financing proposal, 3) the impact of your proposal on eBay’s long-term growth and profitability, 4) the leverage, operational risks, and leadership structure of a combined entity, 5) the resulting implications of these factors on valuation, and 6) GameStop’s governance and executive incentives.

The letter highlighted eBay's recent performance and strategy. “eBay is a strong, resilient business that has delivered meaningful results over the past several years. We have sharpened our strategic focus, strengthened execution, enhanced our marketplace and seller experience, and consistently returned capital to shareholders.”

It went on to say, “With its differentiated global marketplace and a clear strategy, eBay’s Board is confident that the company, under its current management team, is well-positioned to continue to drive sustainable growth, execute with discipline, and deliver long-term value for our shareholders.”

GameStop said it had secured up to $20 billion in debt financing to fund the purchase, but didn’t explain where the rest of the money it offered eBay would come from.

eBay announced last week that it had “no discussions with or outreach from GameStop” prior to receiving the unsolicited bid.