GameStop considers ending $56 billion eBay bid

• GameStop is considering withdrawing its $56 billion takeover proposal for eBay and may pursue a partnership instead, according to Bloomberg.
• GameStop shares rose 2% in premarket trading, while eBay shares fell 1.4%.
• A potential partnership could involve eBay using GameStop’s retail network to expand in trading cards and collectibles.

GameStop (NYSE:GME) is considering withdrawing its $56 billion takeover proposal for eBay (NASDAQ:EBAY) and may instead pursue a partnership or joint venture, according to a Bloomberg report citing people familiar with the matter.

The potential shift follows eBay’s rejection of GameStop’s unsolicited acquisition proposal in May, with eBay saying the offer was “neither credible nor attractive.”

A GameStop spokesperson did not immediately comment on the report, and Reuters could not independently verify the Bloomberg report.

Under a possible partnership structure, GameStop could seek board representation at eBay while allowing eBay to use GameStop’s approximately 1,600 U.S. retail locations to expand in higher-margin categories such as trading cards and collectibles.

Following the report, GameStop shares were up 2% in premarket trading, while eBay shares were down 1.4%.

GameStop increased its stake in eBay to 9.8% in July, making it one of the online marketplace company’s largest shareholders, while Chief Executive Officer Ryan Cohen said he intended to pursue a deal “one way or another.”

The original $56 billion proposal drew skepticism from investors and analysts because GameStop’s market value was significantly smaller than eBay’s and the financing plan relied on debt commitments and stock issuance.

GameStop operates a physical retail network that buys and resells inventory, while eBay operates an online marketplace that connects buyers and sellers and earns fees from transactions.