Global e-commerce company eBay Inc. has described a US$56 billion (A$77.3 billion) takeover proposal from smaller retailer GameStop Corp as “neither credible nor attractive".
“The Board, with the support of its independent advisors, has thoroughly reviewed your proposal and has determined to reject it,” eBay Chairman Paul Pressler said in a news release.
eBay considered factors like its standalone prospects, uncertainty about the bid’s financing, the impact on the long-term growth and profitability, leverage, operational risks and leadership structure of a combined entity and the implications of these for valuation, and GameStop's governance and executive incentives.
A retailer focused on video games, gaming hardware, collectibles and consumer electronics and well known for a 700% one week share price surge in 2021 driven by retail investors, GameStop is offering $125 per share cash and shares.
Pressler said he was confident eBay was well-positioned to continue to drive sustainable growth, execute with discipline and deliver long-term value for shareholders.
“Our team remains focused on executing our strategy and driving our business forward in the best interests of the company, our shareholders, our employees, and millions of buyers and sellers around the world,” he said.
Analysts from research firm Gordon Haskett analysts described GameStop’s offer as a “lopsided marriage proposal” and said the odds of the e-commerce company accepting it were low even before it responded.
“The ball is now in (GameStop CEO and Chair Ryan) Cohen’s court and he must decide whether he is going to put this offer directly in front of shareholders,” the analysts wrote in a research note reported in this CNBC story.
Shares in eBay (NASDAQ: EBAY) closed $2.27 (2.10 %) higher at $110.40 on Tuesday (Wednesday AEST), capitalising the company at $49.01 billion.
GameStop (NYSE: GME) shares closed 80 cents (3.45%) lower at $22.37, implying a market capitalisation of $10.03 billion.
Founded in 1995, eBay was one of the earliest major internet marketplaces and remains a large platform for collectibles, electronics, fashion, cars and second-hand goods.
GameStop operates physical stores and an online marketplace.



