eBay rejects GameStop acquisition proposal over financing and strategic concerns

• eBay rejects GameStop takeover proposal after board review.
• Financing uncertainty among key reasons behind rejection.
• eBay says current strategy positions the company for long-term growth.

eBay has rejected an unsolicited acquisition proposal from GameStop following a review conducted from the company's board alongside its advisers.

In a response letter addressed to GameStop CEO Ryan Cohen, eBay’s Board of Directors said it had carefully evaluated the proposal before deciding to reject it. 

The company cited several concerns, including uncertainty around GameStop’s financing plan, the potential impact on eBay’s long-term growth and profitability, and the operational and leadership risks that could emerge from combining the two businesses.

“The Board, with the support of its independent advisors, has thoroughly reviewed your proposal and has determined to reject it," said eBay chairman of the board of directors Paul S. Pressler. “We have concluded that your proposal is neither credible nor attractive."

“Strong and resilient" 

The board also pointed to GameStop’s governance structure and executive incentives as factors in its decision, alongside concerns about leverage and valuation implications tied to the proposed deal.

Pressler also said the company remains confident in its standalone strategy and current leadership team. 

“eBay is a strong, resilient business that has delivered meaningful results over the past several years," said Pressler. “We have sharpened our strategic focus, strengthened execution, enhanced our marketplace and seller experience, and consistently returned capital to shareholders. 

He added: “Our team remains focused on executing our strategy and driving our business forward in the best interests of the company, our shareholders, our employees, and millions of buyers and sellers around the world." 

The rejection comes following GameStop’s non-binding proposal to acquire eBay in a deal valuing the marketplace at approximately $55.5 billion earlier this month.