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eBay on Tuesday turned down a $56 billion takeover offer from GameStop, citing concerns about how the deal would be financed, while reaffirming confidence in its ongoing turnaround strategy that has helped drive growth.
Market analysts and investors have questioned whether the proposal—structured as a mix of cash and stock, could succeed, given that GameStop, with a market value of about $12 billion, is attempting to acquire a company worth nearly four times as much.
Since the bid was announced earlier this month, eBay shares have traded well below the offered price of $125 per share. Before the opening bell on Tuesday, eBay stock slipped 1% to $107, while GameStop shares dropped 4%.
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eBay rejected the bid, citing concerns about the financing of the deal and stating that the proposal was neither credible nor attractive. The company reaffirmed confidence in its current turnaround strategy and management team.
GameStop proposed a takeover offer of $56 billion, structured as a mix of cash and stock, at a price of $125 per share.
Market analysts questioned the feasibility of the bid because GameStop, with a market value of about $12 billion, was attempting to acquire eBay, which is worth nearly four times as much.
Since the bid was announced, eBay shares have traded below the offered price. eBay stock slipped 1% and GameStop shares dropped 4% on the day eBay turned down the offer.
eBay's Board is confident that the company, under its current management, is well-positioned to continue driving sustainable growth, as indicated by their reaffirmation of their ongoing turnaround strategy.
According to Reuters, eBay chairman Paul Pressler stated, "We have concluded that your proposal is neither credible nor attractive. eBay's Board is confident the company, under its current management team, is well-positioned to continue to drive sustainable growth."
(This is a developing story. More to come)
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