May 4 (UPI) — GameStop has made a $55.5 billion offer to buy eBay, with the video game retailer’s CEO saying Monday the move could create a strong competitor to Amazon.
The offer amounts to $125 per share for eBay, half in cash and half in stock, representing a 46% premium to eBay’s Feb. 4 closing share price. That was the date GameStop accumulated a 5% stake in the e-commerce giant.
“It makes us one of the largest shareholders. So they have a fiduciary duty to their shareholders to evaluate this proposal,” GameStop CEO Ryan Cohen told CNBC on Monday. “This is a business that is under-earning and can make a lot more money. And GameStop is a good blueprint for that.”
Cohen wrote in a letter to eBay’s chair that a buyout would benefit both companies.
“GameStop’s ~1,600 U.S. locations give eBay a national network for authentication, intake, fulfillment and live commerce,” Cohen wrote.
The Board of Directors for eBay confirmed Monday morning that they had received the “unsolicited, non-binding acquisition proposal” and will evaluate it.
The statement urged eBay stockholders not to take any action at this time.
Cohen told the Wall Street Journal that eBay “could be a legit competitor to Amazon” if the takeover attempt succeeds.
He said his proposed plans for eBay include cost-cutting measures and a focus on live commerce, which involves brands using live video streams to sell directly top consumers.
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