GameStop increases eBay stake as takeover battle escalates following rejection

GameStop has again increased its stake in eBay. Days after the e-commerce company rejected its $56 billion takeover bid, the video game retailer disclosed in ‌a filing on Tuesday to increase its stake to about 6.55%.

GameStop previously owned around a 5% stake in eBay and some analysts said its CEO, Ryan Cohen, could eventually push for a special shareholder meeting or seek board representation more supportive of his proposal.

In an interview with journalist Piers Morgan last week, Cohen had said eBay's board ‌had a responsibility to engage with his offer in the best interests of shareholders, adding that "we'll do whatever we need to do" if it fails to do so.

eBay rejected the bid over concerns about the financing of the deal while highlighting its turnaround efforts and improving growth.

The increased stake is widely viewed as an escalation by GameStop CEO Ryan Cohen in his campaign to acquire eBay.

Earlier this month, GameStop offered $125 per share in a cash-and-stock transaction, valuing eBay at about $55.5–56 billion. 

eBay’s board rejected the proposal, calling it “neither credible nor attractive,” largely because of financing concerns and skepticism about the strategic fit.

Reuters previously reported that GameStop cited roughly $20 billion in potential debt financing while also planning to use stock as part of the deal.

GameStop CEO Cohen has indicated he may take the bid directly to shareholders or pursue a more aggressive activist strategy if negotiations remain stalled.