GameStop shares fall 10% after CEO skirts questions over eBay acquisition details
Summary
GameStop's stock dropped over 10% after its CEO, Ryan Cohen, avoided detailed answers about how the company would pay for its unexpected $55.5 billion offer to buy eBay. The proposal includes a mix of cash and stock, but the total funds explained so far do not cover the full offer amount.Key Facts
- GameStop offered to buy eBay for $55.5 billion at $125 a share.
- The offer is half cash and half stock.
- GameStop plans to use about $9.4 billion in cash on hand and $20 billion in possible debt financing.
- GameStop’s market value is about $11-12 billion, much less than eBay’s $46 billion valuation.
- The combined funds GameStop detailed so far add up to around $40 billion, which is $16 billion less than the offer price.
- CEO Ryan Cohen did not clearly explain how GameStop would cover the entire cost.
- Cohen said he has not talked with eBay about the offer.
- eBay confirmed it has not discussed the bid and will review it with its board before commenting further.
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