eBay rejects GameStop's $56B takeover bid — 'neither credible nor attractive'

eBay's board on Tuesday formally rejected GameStop's ($GME) $56 billion unsolicited takeover offer, calling the proposal "neither credible nor attractive" in a letter from chairman Paul Pressler. GameStop CEO Ryan Cohen unveiled the bid last week at $125 per share in a cash-and-stock structure. eBay's market cap stands at roughly $48 billion versus GameStop's approximately $10.3 billion — making the bidder smaller than its target.

Cohen lined up $20 billion in financing from TD Securities (a TD Bank subsidiary) and pointed to GameStop's roughly $9 billion cash hoard. But the gap to a $56 billion deal remains substantial. A key condition in TD's financing letter: the combined company must maintain an investment-grade credit rating from at least two of the top three credit agencies — a condition Moody's all but ruled out, warning the deal would be "credit negative" for eBay given the implied leverage increase.

Wall Street analysts threw cold water on the strategic logic. The two businesses — an online marketplace and a brick-and-mortar gaming retailer — share few operational overlaps. Cohen's pitch centered on converting GameStop's 1,600 U.S. retail stores into eBay authentication and last-mile fulfillment hubs, slashing bloated marketing spend, and unlocking live commerce. In a combative CNBC appearance, Cohen declined to detail his financing plan, saying only: "We have the ability to issue stock in order to get the deal done."

Pressler's letter listed financing uncertainty, excessive debt burden, and operational risk as grounds for rejection. eBay said it remains confident in current management and its standalone strategic plan. Cohen responded by warning that if eBay refuses to engage, he is prepared to take his offer directly to shareholders — leaving open the possibility of a proxy fight.

Key catalysts ahead: any formal SEC filing by Cohen and the response of GameStop's shareholder base to a potential proxy solicitation.

Not investment advice. Verify all figures with primary sources before acting.