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GameStop makes $55.5B takeover offer for eBay

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Re: GameStop makes $55.5B takeover offer for eBay

#371

Post by sbarre »

twoodfin wrote: post #243
sbarre wrote: post #235

Earlier quoted context omitted.

It's the problem of all the employees (and potentially customers) of the company being plundered. They have no say in the matter, and given that the lender can probably absorb the loss without, you know, missing mortgage payments or losing health insurance, I would absolutely argue it's not just their problem. You can certainly hold the opinion that "it's just business" but it feels like an unnecessary part of busine…

This is a fundamental misunderstanding of the US employment model. Businesses can do all sorts of dumb things that end up making them unable to continue to invest in employees. The check against that is the greedy owners. Regulations designed to ensure businesses never take risky bets lest they have to lay people off would be a nightmare of unintended consequences and surely in aggregate hurt employment.

You're bringing your own conclusions to this, I never said anything about regulation.

I was just responding to OP who said that PE plundering via debt loading is only the lender's problem when things don't work out, and I assert that it is not.

Employees often pay a much more impactful price when PE-driven cuts occur (whether by design or because the plan failed).

Re: GameStop makes $55.5B takeover offer for eBay

#372

Post by Forgeties79 »

dgellow wrote: post #280
Forgeties79 wrote: post #158

Earlier quoted context omitted.

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…

Nintendo CEO cutting his salary in half to avoid firing employees https://www.cnbc.com/2024/02/13/nintendo-ceo-once-halved-sal...

Yes and it was 1) incredibly notable, 2) 13 years ago, 3) in another country, and 4) following one of their worst performing products ever. Iwata's (maybe voluntary) temporary pay cut was big news because of how exceptional it was.

Re: GameStop makes $55.5B takeover offer for eBay

#373

Post by turtlesdown11 »

Hilliard_Ohiooo wrote: post #368
turtlesdown11 wrote: post #355

Earlier quoted context omitted.

> I could see this working out decently, assuming the CEO of GameStop doesn't mess it up completely. So far he's failed to improve Gamestop's core business, which is still in decline, even with the memestock cash gusher. No one goes into Gamestop anymore, and they won't start because of eBay.

Just bought a used switch there yesterday, 2 guys are selling or trading some kind of game card, kid and his dad getting a PS4... Like you say, no one goes to game stop anymore, it's too crowded ;)

>Like you say, no one goes to game stop anymore, it's too crowded

Must be why it's revenue is declining to it's historic 2006 level, because it's just too busy.

net sales 2016 $8.6b, 2025 $3.5b and still in decline

Re: GameStop makes $55.5B takeover offer for eBay

#374

Post by Barbing »

elzbardico wrote: post #321
fasteo wrote: post #228

Earlier quoted context omitted.

>>> should-be-illegal process of putting debt on the acquired company's balance sheet This is a basically a leveraged buyout (LBO). All private equity works this way. Yes, it should be illegal, or at least heavily limited. I highly recommend this book: "Plunder: Private Equity’s Plan to Pillage America"

This book got a unfortunate title. Private Equity can be a completely legitimate activity. What it needs is some regulation on some underhanded financial tatics it uses, such as LBO.

Hilton is a good example, right?

But vast majority of the time it’s bad?

Re: GameStop makes $55.5B takeover offer for eBay

#375

Post by HWR_14 »

shmatt wrote: post #263
giancarlostoro wrote: post #240

The original shorting of GameStop back in 2021 gave them a bit of a boost back into the green. While people were doing the GME to the moon, GameStop made more shares to sell, and paid off a bit of its debts, I think it made about a billion dollars in profit, they're still struggling, but it helped prolong their life. A friend of mine also pointed out and this made it click for me that it makes 100% sense, GameStop is…

eBay is dying, new competitors are being created constantly, and the big ones like Poshmark are getting more North American buyers and sellers. eBay has barely grown since their post covid slump Maybe eBay survives as an international site but even at that point, with $20B in debt this will just follow the regular PE playbook of shutting down after many layoffs and pivots The entire concept of, "I have $1,000 in the…

> Can you imagine if the mortgage was owned by our home, not ourselves. And we could stop paying it without any personal consequences

To a large degree you can just stop paying your mortgage.

The biggest personal consequence is you will be evicted and lose both your place to live and any equity you built up.

The other main consequence is it will show up on your credit report for 7 years. Maybe some specific forms ask "have you ever been foreclosed on" in the future.

Re: GameStop makes $55.5B takeover offer for eBay

#377

Post by prewett »

vessenes wrote: post #100
CWwdcdk7h wrote: post #73

Earlier quoted context omitted.

They already increased total number of stock by +39% in last 12 months, GME will squeeze the last penny from those people.

… and the stock has not dropped 39%, in fact it’s trading about where it was a year ago. Shareholders have been content to let Cohen add to the balance sheet, adjust operations and make a large move. This is one such move. And GME is up 5+% in pre trading, so shareholders are generally positive about this idea.

Technically, we only know that the marginal non-shareholder is 5% more positive about the idea, since the price represents what the marginal buyer and seller are willing to transact at. The only shareholders involved in the increase are actually selling.

Re: GameStop makes $55.5B takeover offer for eBay

#378

Post by Barbing »

radlad wrote: post #336
metalliqaz wrote: post #264

Earlier quoted context omitted.

Yes, exactly. In fact there were some ebay "helper" companies that made a go of it in the early 2000's. They went out of business because it doesn't add enough value. USPS created Media Mail and flat rate boxes, and UPS stores are found in nearly every community. They handle the hard part (shipping) well enough. The only thing I can think of is Gamestop positioning to become a clearing house for fan swag or gaming it…

I remember one of these shops all the way back in the late 2000s. At the time I was confused about whether it was operated by eBay or a third party. It did not last long.

iSOLD It on eBay apparently still has listings out of Pasadena, California

https://www.i-soldit.com/listings/

Re: GameStop makes $55.5B takeover offer for eBay

#379

Post by iot_devs »

elzbardico wrote: post #351
taeric wrote: post #252

Earlier quoted context omitted.

I mean, it is functionally the same as home loans? Would you be proposing a carve out that buying a house or car is ok this way, but nothing else?

In a home loan, the borrower buys a house and pledges that house as collateral. The debt is the buyer’s obligation. The house does not have to “pay the mortgage” by laying off the kitchen, selling the roof, or cutting maintenance. The borrower uses outside income to service the debt. In an LBO, a private equity buyer often buys a company using a large amount of debt, but the debt is typically placed on the acquired c…

Something that I never quite understood is who lend the money for this sort of activities?

The lender knows how risky they are.

Re: GameStop makes $55.5B takeover offer for eBay

#380

Post by Barbing »

iwontberude wrote: post #342
metalliqaz wrote: post #264

Earlier quoted context omitted.

Yes, exactly. In fact there were some ebay "helper" companies that made a go of it in the early 2000's. They went out of business because it doesn't add enough value. USPS created Media Mail and flat rate boxes, and UPS stores are found in nearly every community. They handle the hard part (shipping) well enough. The only thing I can think of is Gamestop positioning to become a clearing house for fan swag or gaming it…

It disgusts me how eBay sellers abuse the US Post Office by stealing supplies. It’s one way to guarantee I never buy from someone again.

Then have to waste time to politely educate the sellers…

They wrap up the free priority mail flat rate boxes to obscure markings to send them with a cheaper service. So they know should they’re naughty but might not realize it’s reached the level of a crime, perhaps. Definitely didn’t realize they’d have customers who don’t like stealing from themselves (taxpayers)

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