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GameStop makes $55.5B takeover offer for eBay

bbc.co.uk

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Re: GameStop makes $55.5B takeover offer for eBay

#601

Post by TheGRS »

coffeebeqn wrote: post #587
coredog64 wrote: post #323

Earlier quoted context omitted.

There's one of these near me in a shopping center with terminally low rents. I think the additional value add for these places is that a) they can help you price the item to move and b) they can wade through eBay support if things go wrong.

That sounds like a very low value add. So you’ll have some teenagers clicking on the eBay portal for me like I’ve never used a computer before?

I think the value is in not having to mess with scammers and people who make eBay difficult to interact with (i.e. those who game the system).

Re: GameStop makes $55.5B takeover offer for eBay

#602

Post by ball_of_lint »

orlp wrote: post #598
ball_of_lint wrote: post #532

Earlier quoted context omitted.

> which they claim to have, so let's believe them on their word there So you're just outright accusing GameStop of fraud? https://www.sec.gov/ix?doc=/Archives/edgar/data/1326380/0001... page 36 of their filing with the SEC lists the cash and marketable equities. The non-cash (stock) portion of the offer needs to be valued against the resulting entity, which will own eBay. This will likely result in current eBay share…

> So you're just outright accusing GameStop of fraud? I have no idea why you interpret my words that way. I just meant that I didn't want to analyze the cash portion of their offer any further and just wanted to take it at face value.

They don't claim to have it; they have it.

It's like saying 'tobacco allegedly causes cancer' - the proof is very public and available. The typical reason for saying it like that is to indicate you don't believe it.

Re: GameStop makes $55.5B takeover offer for eBay

#603

Post by TrackerFF »

pesus wrote: post #561
AdmiralAsshat wrote: post #473

CNBC Interview with Ryan Cohen: https://www.youtube.com/watch?v=Bmj2PaxX24E

I see praise on Reddit (by GME stockholders, of course) saying that this makes him appear like some tough rebel standing up against the evil mainstream media... but I'm really not seeing it. To me it seems like a very tired (inebriated?) guy in a leather jacket who can't comprehend or answer a very basic question. Is this what passes for being a good CEO these days? I'd expect them to be able to at least come up with…

The company (stock) subs are always echo chambers of the worst kind, bordering straight up cults.

Bed Bath & Beyond (BBBY) being one of the worst / most hilarious ones.

Re: GameStop makes $55.5B takeover offer for eBay

#604

Post by 59percentmore »

SwellJoe wrote: post #524
59percentmore wrote: post #509

Earlier quoted context omitted.

They haven't been on the verge of bankruptcy since they paid off their own loans. This deal will actually be the closest they've been to bankruptcy since like 2022, because they'll actually have interest payments to make.

That's an accident of becoming a meme stock. That's not a business model. Revenue continues to decline year over year. Nothing about the business has materially changed the trajectory they have been on throughout all of this. https://www.macrotrends.net/stocks/charts/GME/gamestop/reven...

https://www.macrotrends.net/stocks/charts/GME/gamestop/eps-e...

There's something else going on. The other companies known for being meme stocks are doing substantially worse in terms of share price. AMC is below what it was before early 2021, down 90% from its high. That holds for most of them. Bed, Bath, and Beyond famously went bankrupt.

Meanwhile, yeah, Gamestop is down about 75% from its high. But it's also 2.5x its post-top low, and... um, about 24x its 2020 low. Go ahead and check. Makes at least some sense, when you understand that they stemmed an EPS bleed and turned it into a profitable company.

Re: GameStop makes $55.5B takeover offer for eBay

#605

Post by whatever1 »

Do they have the cash to buy them ? If not, why should we provide the limited liquidity that our banks have to finance this?

This logic should apply to all corporate acquisitions. You want to buy another company? Use your own cash and equity. No need for us to be exposed to your risk.

This will also reduce the predatory private equity takeovers.

Re: GameStop makes $55.5B takeover offer for eBay

#607

Post by not_a_bot_4sho »

pesus wrote: post #561
AdmiralAsshat wrote: post #473

CNBC Interview with Ryan Cohen: https://www.youtube.com/watch?v=Bmj2PaxX24E

I see praise on Reddit (by GME stockholders, of course) saying that this makes him appear like some tough rebel standing up against the evil mainstream media... but I'm really not seeing it. To me it seems like a very tired (inebriated?) guy in a leather jacket who can't comprehend or answer a very basic question. Is this what passes for being a good CEO these days? I'd expect them to be able to at least come up with…

I don't know what I was expecting but I didn't walk away from that with any confidence in Ryan's abilities.

Re: GameStop makes $55.5B takeover offer for eBay

#608

Post by blobbers »

Anyone who is interested in how this sort of thing could work, or interested in how it has worked, could read the book "Barbarians at the Gate".

(https://en.wikipedia.org/wiki/Barbarians_at_the_Gate)

This sort of acquisition is typically called an LBO or Leveraged Buy Out. The story gets into the details of key figures involved, including Henry Kravis who people today would better know for his private equity firm KKR.

Basic formula is raise cash using junk bonds, buy company, fix up company or kill off costs, use money company earns to pay debt, sell company. Since you have leveraged, your payout can be large.

It's a similar style financing activity to a house flipper. example: buy house for 1M, but pay $200K + 800K debt (mortgage). Fix up house, sell for $1.2M. Pay off $800K debt. You're left with $400K, or 100% return!

Re: GameStop makes $55.5B takeover offer for eBay

#609

Post by SwellJoe »

59percentmore wrote: post #604
SwellJoe wrote: post #524

Earlier quoted context omitted.

That's an accident of becoming a meme stock. That's not a business model. Revenue continues to decline year over year. Nothing about the business has materially changed the trajectory they have been on throughout all of this. https://www.macrotrends.net/stocks/charts/GME/gamestop/reven...

https://www.macrotrends.net/stocks/charts/GME/gamestop/eps-e... There's something else going on. The other companies known for being meme stocks are doing substantially worse in terms of share price. AMC is below what it was before early 2021, down 90% from its high. That holds for most of them. Bed, Bath, and Beyond famously went bankrupt. Meanwhile, yeah, Gamestop is down about 75% from its high. But it's also 2.5x…

A sinking company buying a healthy company several times larger and more profitable doesn't make sense. The eBay board and shareholders would be crazy to participate in this fantasy. GME shareholders are already known to be of questionable judgment, so whatever they do is SNAFU. So, it's not surprising GameStop would try something crazy, what's surprising is anyone is taking it seriously.

Re: GameStop makes $55.5B takeover offer for eBay

#610

Post by 59percentmore »

DSMan195276 wrote: post #510
59percentmore wrote: post #488

Earlier quoted context omitted.

Buyers? Sure. (Unless you're like me and paranoid after getting porch-pirated.) Sellers...?

Sellers what? You generally don't just drop stuff off at a fulfillment center, when you get to that size you're dealing with large amounts of inventory and you ship it to them. If you're saying sellers could come into a GameStop to have their individual items packed and shipped out, I suppose, but: 1. They don't really have the space for much shipping volume at any of their stores. 2. You can walk into any USPS, UPS,…

Well, look at what you can already do with their trading card program. You could just list cards yourself on eBay, of course. You could drop them off at a shipper to send them off. You could keep them at home while you're waiting for a sale, where I guess they're insured by your renter's/homeowner's insurance. And if you want them graded, you can send them off for that however you like, too.

Or, you can bring your cards into Gamestop, and they'll send them off to get them graded and/or buy them from you, at which point they become inventory for their lootbox. With eBay, you'd be able to do all of that, too, except you'd be selling directly to someone else through a consignment service - more pricing freedom.

And then you could start doing it with things other than cards.

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