Ebay’s board of directors has officially rejected GameStop’s $56 billion acquisition offer, marking a swift end to a proposal that had captivated industry observers. According to Reuters, GameStop’s bid was made up of equal parts cash and stock. However, Ebay found the offer neither credible nor appealing to the company’s future ambitions. The decision came as little surprise to investors, with market prices signaling early on that the likelihood of such a deal closing was slim.
Firm rejection from the board
Ebay’s independent directors raised concerns over how GameStop would finance the deal and emphasized that the company is in a far stronger position under its current leadership. Notably, the $125 per share bid represented a significant premium over Ebay’s prevailing share price, yet this disparity only fueled skepticism in the market about the deal’s feasibility.
GameStop’s offer included $9.4 billion in cash and liquidity, alongside up to $20 billion in debt financing via TD Bank. However, this funding structure required the merged company to maintain an investment-grade credit rating—something analysts considered challenging. Moody’s also assessed that such a transaction would likely have negative implications for Ebay’s credit outlook.
GameStop’s bitcoin exposure comes into focus
After the offer’s rejection, GameStop’s significant cryptocurrency holdings, especially in bitcoin, returned to the spotlight. According to CoinDesk, GameStop managed a bitcoin position of about $368 million, employing options strategies and nearly completing the transfer of all 4,709 BTC to Coinbase Prime as of March. Rather than holding the cryptocurrency outright, the company opted to convert these assets into a receivable form.
GameStop CEO Ryan Cohen had previously described the Ebay bid as “far more appealing than bitcoin,” which also sparked debate about whether the company could liquidate its bitcoin holdings if needed. While offloading its bitcoin might not fully fund the acquisition, GameStop’s crypto assets could demonstrate the seriousness of its bid to investors.
Market response and investor reactions
Ebay’s shares dropped 1 percent to $107 in early trading on Tuesday, well below the offer price. GameStop, meanwhile, saw its own shares fall by 4 percent—underscoring growing doubts among investors and market participants about the offer’s chances.
Sentiment was mixed even within GameStop’s own shareholder base. Michael Burry, the prominent investor known for “The Big Short,” reportedly sold off GameStop shares after the offer was made public, raising concerns about added debt and possible negative consequences for existing shareholders.
Ebay’s management stated that “the company stands on far firmer ground with its current leadership,” dismissing the offer as neither credible nor attractive.
The rejection leaves open questions about GameStop’s next move. Industry watchers now speculate over whether the company will withdraw its offer, raise its bid, or attempt to open direct talks with Ebay’s shareholders.
