GameStop’s takeover bid for eBay dismissed as unconvincing and unappealing.

In the ongoing saga of GameStop’s ambitions, eBay has firmly turned down what they describe as a proposal that lacks both credibility and appeal. It seems GameStop and eBay won’t be teaming up to conquer the Pokémon trading card market after all. Maybe it’s time for GameStop to reconsider those $5,000 Pokémon packs.

On May 3, GameStop made a bold move by proposing to acquire eBay for $55.5 billion, with the payment split evenly between cash and stock. In a discussion with an outlet, GameStop CEO Ryan Cohen expressed his vision of transforming eBay into a serious competitor to Amazon. He also hinted that if eBay’s Board of Directors rejected the acquisition, he wouldn’t hesitate to initiate a proxy fight.

That proxy fight may be on the horizon, as a letter from eBay’s chairman, dated May 12, clearly states that eBay is not interested in the offer. The letter indicates that the Board, with input from independent advisors, has thoroughly evaluated the proposal and decided to reject it. eBay believes it will fare better on its own, citing concerns about GameStop’s governance, financial uncertainties, and the risks of merging operations.

GameStop’s offer raised eyebrows, especially since eBay’s market value is roughly four times that of the game retailer. When pressed about the financials during a CNBC interview, Cohen sidestepped questions about how GameStop would manage to acquire eBay without incurring significant debt.

Adding to the skepticism, GameStop’s reputation is still tied to its survival during the pandemic, largely thanks to a surge in stock purchases by Reddit users. Since then, the company has been gradually shifting away from its traditional focus on physical game sales and leaning more towards a model that profits from high-priced Pokémon cards. While owning eBay could have facilitated this shift, it’s clear that eBay isn’t interested in joining forces.