GameStop, under the leadership of CEO Ryan Cohen, has significantly increased its ownership stake in online auction giant eBay, now holding approximately 9.8% of the company's shares. This move comes as Cohen continues his push to acquire eBay, a goal he first publicly announced in May.
An updated Securities and Exchange Commission filing reveals that GameStop currently controls 43.4 million eBay shares. This represents a substantial increase from the 5% stake initially reported when Cohen made his unsolicited $55.5 billion offer for eBay earlier this year. The offer was made at $125 per share, a combination of cash and stock, with the stated intention of creating a formidable competitor to Amazon.
Cohen has expressed a strong conviction in eBay's potential, telling Bloomberg that he believes the platform can be made "much more profitable and much larger." His vision involves integrating GameStop's expertise in areas such as gaming, refurbished technology, and collectibles with eBay's existing infrastructure. He foresees a future where GameStop stores could serve for same-day authentication, and proposes building out a live commerce presence and an in-game digital marketplace.
"The ability to take GameStop stores and our experience in gaming and refurbished tech and collectibles, combined with eBay and be a leader in live commerce, build out an in-game digital marketplace, use the stores for same-day authentication, and ultimately pull out significant cost," Cohen explained. He also emphasized that these efficiency improvements would not impede growth, stating, "The more efficient you get, the easier it is to grow."
Despite GameStop's increased stake, Cohen indicated that eBay has not yet engaged in discussions regarding the acquisition. He noted that eBay rejected the initial offer, calling it "neither credible nor attractive" after a review. Cohen stated his hope for future engagement but acknowledged that eBay's leadership is "entrenched, and they're hiding behind their advisors."
When pressed for clarity on his motivations, Cohen reiterated his focus on maximizing shareholder value and business profitability. He pointed to live commerce and the development of an in-game visual marketplace as key growth areas. "What is the goal of business? What is my goal? I own a lot of stock, and I don't have any perverse incentive, so it's to make the business a lot more profitable and to maximize shareholder value," he said.
This push for eBay acquisition occurs against a backdrop of significant changes at GameStop. The company recently announced plans to close hundreds of stores, coinciding with news of Cohen's pursuit of substantial performance-based stock options. Cohen also dismissed the impact of Sony's decision to cease production of physical game discs, stating it "doesn't matter at all."