Wonder what Shkreli thinks of this.
GameStop makes $55.5B takeover offer for eBay
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Re: GameStop makes $55.5B takeover offer for eBay
#152Earlier quoted context omitted.
>GME is ~12B, EBAY is ~46B (58 total) with net income of 0.4B and 2B (2.4 total). If he boosts profit by 1.2B then it's nearly a 50% increase and probably going to result in a more valuable combined company despite the debt. GameStop had revenues of $3bn last year and eBay was $10-12bn, so combined it's $13-15bn. A net income increase of 1.2bn on that gross is a tall order for M&A efficiencies. Especially difficult w…
I don't think this is a serious assessment. For years, the core business of both companies has been facilitating the flow of used goods. Gamestop has moved strongly into collectibles recently, with a partnership with collectible grading firm PSA and the introduction of (essentially) lucrative trading card lootboxes, whereas eBay has capitalized on the same expansion of the collectibles market with new live/flash auct…
They are wildly different businesses. Ebay is not in the business of holding physical goods, they are a marketplace that connects buys, sellers, and shippers and adjudicates fraud, collects funds, handles taxes, etc. They are not a warehouse.
Gatestop is a retail operation that buys and sells goods. It takes on all the liability for fake products, it puts capital on the line to purchase used goods, it is a totally different (and worse) business
Re: GameStop makes $55.5B takeover offer for eBay
#153Re: GameStop makes $55.5B takeover offer for eBay
#154Important background: https://investor.gamestop.com/news-releases/news-details/202... CEO gets paid "only if GameStop achieves a market capitalization of $20 billion." Buying a $55bn company would certainly achieve that quickly. I'm not sure how they'd manage that (buy with what? Memes?), other than the should-be-illegal process of putting debt on the acquired company's balance sheet.
Cohen is already rich rich, his GameStop compensation doesn’t really matter much. The eBay acquisition could be a strategy to juice his compensation but I think it is much more likely he does believe that he can achieve his stated aims, which will financially benefit him much more in the long term.
If there's anything rich people famously hate, it's making more money.
Re: GameStop makes $55.5B takeover offer for eBay
#155Earlier quoted context omitted.
Wouldn’t that debt knock down the market cap as much as the value Otherwise take out a $20b loan and put it in the bank. Assets increase $20b, job done.
Well, his argument is that he can remove inefficiencies in the combined company. GME is ~12B, EBAY is ~46B (58 total) with net income of 0.4B and 2B (2.4 total). If he boosts profit by 1.2B then it's nearly a 50% increase and probably going to result in a more valuable combined company despite the debt.
That is a massive “if”
Re: GameStop makes $55.5B takeover offer for eBay
#156ebay is still "old internet", and genuinely useful and well built. enshittification is incoming...
Have you used eBay in the last few years? It's awful for sellers and awful for buyers. This is coming from somebody who buys on eBay twice a month on average.
What would make it better? My only complaint as a seller is fees. I have no complaints as a buyer.
The best part is eBay works exactly the same as 10 years ago, as far as I can tell.
Re: GameStop makes $55.5B takeover offer for eBay
#157I was just thinking how nice it was to still get used stuff on eBay and now Mr. McMemeStock is going to kill it to extract a few billion for himself.
Yay.
Re: GameStop makes $55.5B takeover offer for eBay
#158Important background: https://investor.gamestop.com/news-releases/news-details/202... CEO gets paid "only if GameStop achieves a market capitalization of $20 billion." Buying a $55bn company would certainly achieve that quickly. I'm not sure how they'd manage that (buy with what? Memes?), other than the should-be-illegal process of putting debt on the acquired company's balance sheet.
Cohen is already rich rich, his GameStop compensation doesn’t really matter much. The eBay acquisition could be a strategy to juice his compensation but I think it is much more likely he does believe that he can achieve his stated aims, which will financially benefit him much more in the long term.
Few CEO’s in the US are rewarded for longterm thinking when there are unsustainable quarterly gains to be made. GameStop also has a strange history, especially the last decade, that no one could possibly describe as “cautious” or “planning longterm.”
I also can’t name a single CEO who had the mentality of “I’m rich enough to make personal/financial sacrifices for the good of the company.” That’s simply not how things work. I’m sure an example exists but it would clearly be an exception to the rule.
Re: GameStop makes $55.5B takeover offer for eBay
#159A lot of the comments here seem to assume that a smaller public company can’t acquire a larger one, which just isn’t true. A quick search for how leveraged acquisitions, stock-for-stock deals, financing commitments, or tender offers work would answer most of the objections. Is it too much to ask the Hacker News commentariat to do one quick search before collectively declaring that something they don’t understand is i…
But if it all goes sour nobody will be held accountable and two not one company are ruined. I don't see how such leveraged acquisitions should be legal.
They better not ruin eBay, it's actually a useful business, I use it all the time