Half Cash, Half Stock, Zero Loyalty: eBay Rejects GameStop’s $56B Bid
Ryan Cohen's half-cash, half-stock bid to acquire eBay was quickly rejected.The company's board told GameStop's CEO that after a thorough review with independent consultants, the proposal was neither credible nor attractive.
In a letter signed by Chairman Paul Pressler and addressed directly to Cohen, the board listed six reasons for rejection: eBay's high independence expectations, uncertainty over GameStop's finances, the deal's impact on eBay's long-term growth and profitability, the benefits of a single entity and operational concerns, those concerns and the concerns of executive management.
Pressler told Cohen that his proposal failed on both counts, credibility and appeal, leaving little room for a revised approach.
eBay, which connects millions of buyers and sellers on a global marketplace, has spent recent years sharpening its strategic focus, strengthening its operations and returning capital to shareholders.
Pressler is confident the company will continue to deliver value to shareholders, employees and market participants.
GameStop extended losses in premarket trading on Tuesday, after falling 4.5% in the previous session, according to Yahoo Finance. EBay shares were mostly flat.
Disclosure: This article was edited by Vivian Nguyen. See our Editorial Policy for more information on how we create and review content.
