GameStop CEO Ryan Cohen got banned from eBay after listing personal items to fund his $56 billion bid to acquire the platform in a viral stunt gone wrong.
They mention that gap even though GameStop has already explained how the deal works. They said the deal is half cash and half stock, so GameStop has $9 billion on hand they can spend and a $20 Billion loan from TD, there you now have the cash needed. As for the stock how it works is GameStop and EBay will become one new company and the EBay shareholders will receive a larger percentage of that company than the GameStop shareholders will. The exact percentage needs to be negotiated but it could be 80% to EBay and 20% to GameStop as an example.
The idea here is that GameStop compliments EBay really well as GS has thousands of physical stores that already know how to handle used products. So an EBay seller can take their products to a GS and to have them graded if needed and to drop off the product so GS handles the shipping. The Buyer of the product now knows that the item has been inspected and graded by an employee giving them confidence and they have the option to pick up at their local GS for cheaper shipping prices at a time when shipping is becoming more expensive. Also the GS board is really good at what they do and could make EBay a more profitable company.
Smaller companies buy larger companies all the time. For example Paramount buying Warner Brothers.
They mention that gap even though GameStop has already explained how the deal works. They said the deal is half cash and half stock, so GameStop has $9 billion on hand they can spend and a $20 Billion loan from TD, there you now have the cash needed. As for the stock how it works is GameStop and EBay will become one new company and the EBay shareholders will receive a larger percentage of that company than the GameStop shareholders will. The exact percentage needs to be negotiated but it could be 80% to EBay and 20% to GameStop as an example.
The idea here is that GameStop compliments EBay really well as GS has thousands of physical stores that already know how to handle used products. So an EBay seller can take their products to a GS and to have them graded if needed and to drop off the product so GS handles the shipping. The Buyer of the product now knows that the item has been inspected and graded by an employee giving them confidence and they have the option to pick up at their local GS for cheaper shipping prices at a time when shipping is becoming more expensive. Also the GS board is really good at what they do and could make EBay a more profitable company.
Smaller companies buy larger companies all the time. For example Paramount buying Warner Brothers.
The merger could actually improve ebay, they’ve a lot of untapped potential, they should be getting into competing with Amazon or something.
Ah so stock dilution is the proposed plan