GameStop's bold $56 billion bid for eBay hit a wall on Tuesday when eBay's board formally rejected the offer. The board called the half-cash, half-stock proposal “neither credible nor attractive,” according to Reuters, pointing to financing uncertainties and arguing that eBay is better off under its current management. The rejection came as no surprise—eBay shares have traded well below GameStop's $125-per-share offer since it was made public, signaling market skepticism about the deal's feasibility.
Deal Details: Cash and Debt, with a Credit Rating Catch
GameStop's offer relied on $9.4 billion in cash and liquid assets plus up to $20 billion in debt financing from TD Bank. However, that financing is contingent on the combined company maintaining an investment-grade credit rating. Moody's has already warned the deal would be negative for eBay's credit profile, putting the financing terms in jeopardy. Any attempt to raise the bid or go hostile would likely make the financial conditions even tougher.
GameStop's Bitcoin Position: $368 Million in Exposure via Coinbase Prime
The rejection refocuses attention on GameStop's bitcoin holdings. The retailer holds approximately $368 million in bitcoin exposure through a covered call options strategy. According to a March filing, GameStop moved virtually all of its 4,709 BTC to institutional brokerage Coinbase Prime, converting the position from directly held bitcoin into a receivable asset. This shift could make it easier to liquidate if additional cash is needed for a revised offer—or for other strategic moves.
Cohen's Stance and What Comes Next
GameStop chairman Ryan Cohen has previously pitched the eBay acquisition as “much more attractive than bitcoin,” leaving open the question of whether the BTC position could be sold if more cash is required. While selling the bitcoin alone wouldn't finance the deal, it is one of the few discretionary assets GameStop can point to as it tries to convince investors its bid is real. The company now faces three paths: walk away, raise the offer, or take the battle directly to eBay shareholders. Whichever route it chooses, the fate of its bitcoin stash will be a key variable.