Online marketplace eBay has rejected a $55.5 billion (£40.9bn) takeover offer from video game retailer GameStop, calling it “unsolicited” and “neither credible nor attractive.”
Analysts had expected the offer to be rejected as GameStop is much smaller than eBay, which said there was “uncertainty” over how the deal would be financed.
Although eBay has suffered in recent years, partly due to more competition from online sellers like Amazon, Etsy, and Temu, it insisted its turnaround plan was working.
Key Highlights:
- eBay rejected a $55.5 billion takeover bid from GameStop, calling the offer “unsolicited” and not credible.
- eBay said there were concerns about how the deal would be financed and the risks of merging the two companies.
- GameStop CEO Ryan Cohen had argued that eBay could perform better under his leadership and compete more strongly with Amazon.
- Analysts expected the rejection because GameStop is much smaller than eBay and would likely need heavy borrowing to fund the takeover.
- Despite increased competition from companies like Etsy and Temu, eBay said its turnaround strategy is improving profitability.
GameStop rose to prominence as a “meme stock,” which sees retail investors buy up shares in unloved companies that professional investors have bet against, causing the share price to rise and fall sharply.
In a letter to GameStop chief executive Ryan Cohen rejecting the surprise offer, eBay’s board of directors said the online auction giant was a “strong, resilient business.”
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It cited as a reason for rejection “the impact of your proposal on eBay’s long-term growth and profitability”, adding it had also considered the offer’s “operational risks, and leadership structure of a combined entity.”
It also cited “GameStop’s governance” in the list of factors it had determined before rejecting last week’s bid.
But it wouldn’t be the end of the line for GameStop if it chooses to take its proposal directly to eBay shareholders, which Cohen said last week he would do if faced with a “no” from the board.
eBay’s net profit in 2025 rose to $418.4 million, which, despite a fall in sales, was up from the previous year’s $131.3 million.
GameStop is worth about a quarter of online auction giant eBay. It has around 1,600 stores globally, mostly in the US.
When it made its offer, GameStop said that it had a commitment letter from TD Securities to provide around $20 billion in debt to help finance the takeover.
Cohen said eBay could be much more successful under his leadership and even rival Amazon.
But analyst Sucharita Kodali, a retail analyst at research firm Forrester, told the BBC at the time that the proposal did not sound like a “terribly good offer” as it would saddle eBay with GameStop’s debt.
The BBC has approached GameStop for comment.
