GameStop CEO Gets Banned From eBay While Trying to Buy eBay : nottheonion@lemmy.world

[–] videogamesandbeer@lemmy.world 74 points 6 months ago (12 children)

eBay suspended GameStop CEO Ryan Cohen’s account after he launched a publicity stunt to “fund” his $56 billion unsolicited bid for the company. Cohen listed personal items—including a life-sized Halo 2 statue drawing $10,000+ bids, vintage Willie Mays baseball cards, and literal socks—claiming the sales would help finance the acquisition.

The platform apparently didn’t appreciate the irony of someone using their service to raise money to buy them out. GameStop secured a “highly confident” letter from TD Securities for $20 billion in debt financing, but that leaves a casual $36 billion gap for a company worth roughly $12 billion trying to acquire a $48 billion marketplace.

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[–] YoureHotCupCake@lemmy.world 23 points 6 months ago* (11 children)

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.

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[–] Elting@piefed.social 15 points 6 months ago* (last edited 6 months ago) (8 children)

That is still only $29 billion and somehow I don't think the CEO is gonna raise another $27 billion from selling socks and knickknacks. Kinda just sounds like inserting a middleman to angle at more profit. I would rather not pay a surcharge for eBay auctions, even if it adds some kind of quality assurance. His explanation of the acquisition just seems like more bullshit.

Edit: I wonder how many bag holders from the memestock era are viewing this as their salvation.

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[–] YoureHotCupCake@lemmy.world 1 point 6 months ago (7 children)

I mean GameStop is a great investment, they have had 7 positive earnings in a row now and have been able to build up a lot of capital in the process which they are now trying to utilize to acquire other companies like with ebay right now. Maybe this deal doesn't go through maybe it does but they are clearly trying to make moves to expand. Its been nothing but positive since Ryan Cohen took over as CEO.

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[–] Elting@piefed.social 6 points 6 months ago (5 children)

Being that he is a billionaire, his connection to reality probably rivals your own.

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[–] YoureHotCupCake@lemmy.world 0 points 6 months ago (4 children)

Last I checked when you invest in a company you want them to be profitable and maintain those profits while growing right? IDK why I would be out of touch for liking a company that is doing that, also a company I shop at and have been my whole life.

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[–] Elting@piefed.social 2 points 6 months ago (3 children)

When you invest in a company you also then have a vested interest in them doing well. That can cloud your judgement and cause you to look at the things you want to see.

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[–] YoureHotCupCake@lemmy.world 1 point 6 months ago (2 children)

Sure but they are doing well, they are profitable and using that money to grow. Ebay + GameStop merges the physical and online used products space, not to mention both are huge on collectables too. You say I am only seeing what I want to see so enlighten me on what I am missing.

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[–] Elting@piefed.social 3 points 6 months ago (1 child)

Ryan Cohen is very strange and uncomfortable.

Public perception of game stop is already poor and he is not helping that.

A few quarters of profitability is hardly enough to go on if you are trying to measure long term stability.

Gamestop revenue has never recovered to pre-pandemic levels.

Personally, if I am investing in a company, I am doing it because I believe in their mission for some reason. Maybe they are vital to the community. Maybe they are doing things in a way that is more ethical than their competition. Gamestop sells cheap plastic shit, I cannot make myself believe in that.

Frankly the whole idea of investing in a company to make personal profit out of it is cynical and rooted in exploitive capitalistic thinking.

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[–] YoureHotCupCake@lemmy.world 0 points 6 months ago*

Ryan Cohen is very strange and uncomfortable.

I don't think that, but it doesn't really matter either as numerous CEOs could be described this way.

Public perception of game stop is already poor and he is not helping that.

I don't see how its poor when they have lines outside their buildings every time a new game/console comes out just like they have since I was a child. I still shop there and so do my friends and family. Maybe there is negative comments online but IRL doesn't seem that way.

A few quarters of profitability is hardly enough to go on if you are trying to measure long term stability.

We are talking about a company that was started in 1984 and has a recession proof business model that has proven it numerous times. I think they check the long term stability especially since as long as Xbox, Nintendo, Playstation, Steam Consoles and trading cards exist so will GameStop.

Gamestop revenue has never recovered to pre-pandemic levels.

Revenue is down because they have been cutting bloated stores that were not profitable so revenue is down but profits are up which just means they have been cost cutting something that is seen as a benefit to other companies. Also profits lead to more revenue as we see with them trying to purchase ebay, their revenue will be at an all time high if the deal goes through and if it doesn't they will try and purchase a different company.

Gamestop sells cheap plastic shit, I cannot make myself believe in that.

They primarily sell electronics and collectables with trading cards being the largest part of their collectables. I wouldn't call my Playstation and my pokemon cards cheap plastic shit, but hey maybes its not something you are into like me so I understand why it doesn't interest you.

Frankly the whole idea of investing in a company to make personal profit out of it is cynical and rooted in exploitive capitalistic thinking.

You are not wrong there but this is the system we live in, I would love for something different but I would also like to retire one day.

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[–] Susaga@sh.itjust.works 1 point 6 months ago

Imagine if I offered Dua Lipa 500 quid to have sex. She doesn't need the money, she's doing fine in the bedroom, and I don't have that much money to spend. We can't try to sweeten the deal by saying I'm a good lay. Even if we're not being self-deprecating, we both know I'd be getting the better end of the deal here. She would be insulted I even asked.

That's what's going on. eBay is doing perfectly fine without a physical storefront, and GameStop isn't a catch. GameStop made an unsolicited offer, and doesn't have enough to actually pay it. This is an insult of an offer.

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