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0 pointsgraemep1mo ago0 comments

They are paying half in GameStock equity. They will issue new shares so they will buy Ebay of $55bn, but add only $20bn debt.

Its good for GameStock management who will end up running a much bigger business. https://investor.gamestop.com/news-releases/news-details/202...

Game Stock management is essentially claiming that they can run Ebay better than the current management so Ebay shareholders will end up better off by selling to Game Stock: they get some cash and shares in a business that will be mostly a better run Ebay. Very possible bad for GameStock shareholders who will end up with a smaller stake in a bigger business.

0 pointsgraemep1mo ago0 comments

They are paying half in GameStock equity. They will issue new shares so they will buy Ebay of $55bn, but add only $20bn debt.

Its good for GameStock management who will end up running a much bigger business. https://investor.gamestop.com/news-releases/news-details/202...

0 comments

6 comments · 2 top-level

59percentmore1mo ago· 3 in thread

It depends. If Gamestop is able to find the efficiencies that the CEO is claiming, EPS jumps between 50 and 100 percent. Gamestop shareholders get diluted down to owning a smaller piece of a much bigger earnings pie. That's if you don't engage in any conspiracy theories about how many shares retail traders really own (don't go down that rabbit hole).

Suffice it to say, the Gamestop's price floor has gone up each time it's been diluted in the past few years. Perhaps lower highs, but higher lows. And a company that can afford to try a stunt like this.

graemepOP1mo ago

True, that is why I said "very possibly". The market seems mildly positive about i so far.

its a big promise. Is Ebay really THAT badly run that they can find such efficiencies?

turtlesdown111mo ago

> Is Ebay really THAT badly run that they can find such efficiencies?

Well, we should point out that Gamestop hasn't grown their own business - they've lost 50% of revenue since 2020. Why would anyone trust that management to "turn around" another business?

notahacker1mo ago

The market being mildly positive probably doesn't mean much when it's a memestock...

eloisant1mo ago· 1 in thread

It that's bad for GameStock shareholders, surely they'll vote against it?

brookst1mo ago

Do they get a vote?

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