eBay Rejects GameStop's $56 Billion Bid

eBay rejected an unsolicited $56 billion takeover bid from GameStop on Tuesday, with its board deeming the cash-and-stock proposal neither credible nor attractive.

The offer, valued at $125 per share, came from GameStop Chief Executive Ryan Cohen in early May. eBay Chairman Paul Pressler outlined the board's decision in a public letter to Cohen, citing uncertainty over the financing plan, potential risks to long-term growth and profitability, high leverage and operational challenges in a combined company, valuation implications, and concerns about GameStop's governance and executive incentives. "We have concluded that your proposal is neither credible nor attractive," Pressler wrote. He emphasized eBay's recent progress under current management, stating, "We have sharpened our strategic focus, strengthened execution, enhanced our marketplace and seller experience, and consistently returned capital to shareholders."

GameStop, with a market capitalization of about $12 billion and roughly $9.4 billion in cash and assets, proposed funding the deal half in cash and half in stock. The company secured a commitment letter from TD Securities for $20 billion in debt financing. Cohen...