GameStop was trying to do a Private Equity style takeover. Everyone hates it when PE companies do that, but GameStop is an lol memestock so that fact was overlooked with all of the to the moon comments. I do not want any platform I use being taken over by in a highly leveraged takeover, especially not by GameStop.
I had some old stuff around that Mr everyday might find (eg pristine original Gameboy Pokémon cartridge without box), and quick resale would give me 10 euro, involved resale would ask me hours and hours of work ebay allowed me to sale for 120+euro spending 1h on the description and picture (to show the scratch etc).
Another case is "oh you have the msi ge77vx4 laotop and you look for the plastic keyboard map in azerty? You can pay a 500e rma if they even allow it or buy the piece for 20e on ebay and fix it yourself"
Ymmv but it has a specific place that no one really have right now
I buy most of my physical games from eBay too
So, collectables...
I am quite confident that if GameStop bought eBay, they would ruin it in the same way that K-Mart buying Sears ruined that company.
I could be wrong, I'm not a business person, but it seems kind of obvious that a company like GameStop, whose current existence appears to be due to a weird short squeeze anomaly, is not a sustainable business.
Like yeah, GameStop clearly fits into the death of retail, and acquiring eBay does increase their market visibility or presence. Beyond that, what ebay/GS could’ve gained is way different and arguably more substantial than what acquiring Sears did for either company involved. Atleast here, one operates storefronts for second hand transactions and the other expressly doesn’t. There is definitely money in that.
They already have the position of used buying and sales, extending that into in store receiving and listing of items on eBay makes sense. eBay being in decline as well.
>K-Mart buying Sears ruined that company
Both were quite dead by the time that happened.
I agree that if GameStop were basically rebranded as eBay brick and mortar stores, that might work. I guess I just feel like if it were GameStop itself that were managing it then it would be unlikely to actually work.
It's not like digital storefronts are new; I think GameStop should have been pivoting the moment that Steam started getting traction.
I am unsure how a Gamestop/eBay storefront would do. Physical manifestations of "eBay stores" have existed in the past and none of them did very well long term.
For the benefit of all the people on this thread not understanding what the proposal is for the acqusition: "A leveraged buyout (LBO) is the acquisition of a company (typically by a private equity firm) using a significant amount of borrowed money (debt) to meet the purchase price, often 60% to 90% of the total cost. The target company’s assets are used as collateral for the loans, which are repaid using the company's future cash flows."
Couple of highlights on Ryan
- Built and sold Chewy from a startup to the largest ecomm acq of all time - Became #1 individual shareholder of Apple early on - Bought a 10% share of Gamespot in 2020 becoming largest personal shareholder - Took over as CEO after being a proactive board member, works for no salary
They can't afford $56 billion - the proposed acquisition was going to be halfway paid for in stock and halfway via a loan. (Though, they also can't afford $28B in stock - the entire company is only worth $10B - so the idea was going to be to pay for it by issuing new shares of the merged GameStop-Ebay entity, after the deal was signed.)
If that sounds audacious, it's because it is - as far as I've seen, most analysts were not expecting this deal to be taken seriously, and many are calling it a publicity stunt.
They propose to borrow $20bn, twice their market cap, to buy a company worth five times their market cap. And 50% of it would be in Gamestop shares, which would be insane for eBay investors to accept. Yes the combined company would now own eBay, but would have the massive baggage of Gamestop's dwindling business plus $20bn of extra debt - a recipe for collapse.
There's no upside for eBay's shareholders, even if Gamestop was capable of pulling off the transaction, which is extremely unlikely even if eBay was crazy enough to be willing to accept it.
In 2026? Online shopping is full of low quality knockoff crap, with deveptive listings that are trying to trick you. Yes, I absolutely prefer physical stores again. In fact I've pretty much stopped online shopping altogether again
The interview was so bad the first time I saw it I thought it was some sort of satire bit. No, it was real and the commentators were literally speechless.
Not much different than me having a bit of cash and putting 5% or 20% down to buy a home or car: now I’m a big asset and debt holder and you got some pieces of paper with dead presidents on it.
That was the hard part of the deal: will (enough) eBay shareholders want to be GameStop shareholders.
eBay shareholders would be right to be upset with eBay management. eBay has treaded water in a niche of online shopping while online shopping has grown massively. Whether GameStop is their solution or not, Iunno.
So he's basically looking to launder his freshly minted meme stonks into legitimate real company stock. It's shocking they don't want it.
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001326380/0...
"We are asking our stockholders to approve an amendment to our Third Amended and Restated Certificate of Incorporation, as amended by the Certificate of Amendment dated June 2, 2022 (the “Existing Charter”), to increase the number of authorized shares of our common stock to 2,500,000,000, and correspondingly increase the number of authorized shares of all classes of our stock to 2,505,000,000 for the reasons discussed below. Our Existing Charter currently authorizes the issuance of 1,000,000,000 shares of common stock and 5,000,000 shares of preferred stock."
eBay’s biggest issue is their declining online shopping marketshare. They’ve gone from owning nearly the entire market to just losing it.
(I couldn't believe myself at first seeing things like these happening and this clip in particular, how does one get millions of dollars for such an disastrously wild interview to me feels quite off to me)
Kind reminder to donate to archive.org: https://archive.org/donate
This helps because google captcha now sometimes require android phone qr code scanning etc. so I have uploaded the article on archive.org
[0]: I am creator of htmlpipe which archives archive.is pages on archive.org
(I was gonna add it as a comment below bstsb but it seems to have been detached now so can't comment on it)
GameStop CEO Ryan Cohen gets a performance pay if the market cap goes up:
> The total award consists of stock options to purchase 171,537,327 shares of the Company's Class A common stock at a price of $20.66 per share.
Tranche Award% Market Cap Hurdle EBITDA Hurdle
1 10% $20 Billion $2.0 Billion
2 10% $30 Billion $3.0 Billion
3 10% $40 Billion $4.0 Billion
4 10% $50 Billion $5.0 Billion
5 10% $60 Billion $6.0 Billion
6 10% $70 Billion $7.0 Billion
7 10% $80 Billion $8.0 Billion
8 15% $90 Billion $9.0 Billion
9 15% $100 Billion $10.0 Billion
eBay market cap is $48B.
https://investor.gamestop.com/news-releases/news-details/202...
The Performance Hurdles will be adjusted by the Committee equitably and proportionately as determined by the Committee in a manner designed to preserve the economic opportunity provided under the Award, (a) higher to account for acquisition activity for which stock is provided as consideration; and (b) lower to account for a split-up, spin-off, dividend or other distribution (whether in the form of cash, shares, other securities, or other property) or divestiture activity, in each case, that could be considered material to the achievement of the Performance Hurdles, as applicable.
Probably more people than ever have thought of starting a shopping search on eBay than ever (outside pandemic shortages).
of course the offer wasn't serious. did anyone see the interview GameStop CEO did with Andrew Ross Sorkin? he clearly didn't have the money and was trying to gaslight the world.
That being said I don't really care whether either end of the sale goes through.