GameStop has increased its stake in eBay. Is this a response to the marketplace's rejection of the takeover?
GameStop has increased its stake in eBay after rejecting a $56 billion takeover / Photo: Stock all / Shutterstock.com
Gaming retailer GameStop has increased its stake in online marketplace eBay from 5% to about 6.55%, according to documents filed with the regulator. The increased position comes a week after the platform rejected GameStop's $56 billion takeover offer.
eBay declined to sell the business over concerns about financing the deal while recalling its ongoing efforts to restructure and improve growth, Reuters writes.
According to some analysts, GameStop CEO Ryan Cohen may end up calling for a special shareholder meeting or trying to put people more loyal to his proposal on the board, the agency points out.
Quotes eBay jumped at the auction on May 20 by 3.5%, shares of GameStop rose by 2.6%.
Context
On Ma. 3, GameStop CEO Cohen offered to buy out eBay at $125 per share - at the time, that implied a 20% premium. He explained that he plans to use the retailer's 1,600 stores as delivery and verification centers for collectibles for the marketplace. The terms of the deal called for payment equally in cash and GameStop stock, and Cohen also wanted to raise up to $20 billion in debt from TD Bank. However, the market was skeptical of the proposal: GameStop's capitalization is $10 billion, less than a quarter of eBay's value.
On Ma. 7, Cohen told social network X that he put up personal items and various goods on eBay for tens of thousands of dollars, including a pair of socks and GameStop signs, to finance the deal, promising buyers copies of the takeover letters with his personal signature. However, just hours after the auction began, the GameStop CEO's account on the platform was blocked.
In an interview last week, Cohen said eBay's board had an obligation to consider his proposal in the best interest of shareholders, adding that he would "do whatever is necessary" if that didn't happen.
Online platform eBay now has 136 million users and generated $11.6 billion in revenue last year. GameStop operates a network of 2,200 retail stores in the U.S., France and Australia, which brought it $3.6 billion in annual revenue.
This article was AI-translated and verified by a human editor
