GameStop CEO Ryan Cohen mulls dropping $56B eBay takeover bid: report | Latest Tech News
GameStop CEO Ryan Cohen is contemplating yanking his $56 billion bid to take over eBay after the bid obtained a lukewarm reception on Wall Street, according to a report.
Cohen – who grew to become a favourite of retail traders as GameStop rose to “meme stock” prominence – is instead weighing whether or not to suggest a partnership that would permit eBay access to GameStop’s base of about 1,600 US shops, Bloomberg reported, citing people acquainted with the matter.
The partnership would theoretically permit both GameStop and eBay to take a bigger slice of the profitable markets for trading playing cards and collectibles, sources told the outlet. GameStop would also need a seat on eBay’s board of administrators.
EBay’s stock was down about 4% to $107.58 in noon trading Monday. GameStop’s stock was flat at $19.15 per share.
GameStop proposed shopping for eBay for $56 billion in May. NurPhoto via Getty Images
Cohen generated healthy skepticism in May when he unveiled a non-binding proposal to buy eBay at $125 per share in money and stock – an quantity that, at the time was a 20% premium over eBay’s stock price.
The billionaire GameStop CEO told the Wall Street Journal that he had a plan that would flip eBay into “something worth hundreds of billions of dollars.”
Critics questioned where GameStop, whose roughly $8.6 million market cap is much smaller than eBay’s valuation of $48 billion, would come up with the money for the deal. At the same time, GameStop has constructed a 9.75% possession stake in eBay, making it the company’s second-largest shareholder, according to Bloomberg.
Ryan Cohen is the CEO of GameStop.
EBay’s board of administrators said it was against Cohen’s takeover offer in May, describing it as “neither credible nor attractive” and raising doubts about his capacity to secure financing.
“eBay’s Board is confident the company, under its current management team, is well-positioned to continue to drive sustainable growth,” Chairman Paul Pressler said in a assertion on May 12.
The Post has reached out to GameStop and eBay for remark.
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