Updating its unsolicited bid announced earlier on May 4, GameStop has disclosed a 5% economic stake in eBay while proposing a $55.5 billion non-binding acquisition at $125 per share in cash and stock. Funding includes $9.4 billion in cash and liquid investments—featuring $368 million in bitcoin—and up to $20 billion in financing, prompting questions over the retailer's cryptocurrency future.
GameStop's bid, valuing eBay at a 46% premium to its early February share price and 27% above its 30-day volume-weighted average, was built through shares and derivatives for the 5% economic stake. CEO Ryan Cohen, who in February called such expansion 'way more compelling than bitcoin,' has not detailed bitcoin sale plans. eBay's board stated it would review the proposal with financial advisers, as there were no prior discussions, and urged shareholders to take no action.
GameStop's $9.4 billion cash pile includes $368 million in bitcoin now held at Coinbase Prime under a yield-generating options strategy. The company secured a $20 billion financing commitment from TD Securities and can issue stock. The deal aims to leverage GameStop's 1,600 U.S. stores for eBay's authentication, fulfillment, and live commerce in collectibles and retro games, projecting $2 billion in annualized savings from eBay's sales, marketing, product development, and admin costs within 12 months.
Post-announcement, GameStop shares declined while eBay's rose, reflecting investor skepticism on financing. This follows rumors and the initial bid disclosure earlier today, as covered in the 'GameStop's eBay Acquisition Bid' series.
