The Liberty Daily 
(ZeroHedge)—Anyone who took GameStop CEO Ryan Cohen’s bid for eBay seriously should have reconsidered after his CNBC interview with Andrew Ross Sorkin in early May.
When Sorkin pressed him on the basic math, Cohen failed to clearly explain how GameStop could finance the $56 billion deal or make the proposed cash-and-stock structure work. The interview raised more questions than it answered and pointed to the inevitable conclusion: the deal was never likely to happen from the start.
Fast-forward to Monday morning, when a new Bloomberg report citing people familiar with the matter said Cohen is considering withdrawing the $56 billion bid for the online marketplace.
However, Cohen is not giving up on a potential partnership with eBay. He is reportedly considering proposing a partnership or joint venture that would allow eBay to utilize GameStop’s roughly 1,600 US stores to expand in higher-margin categories such as trading cards and collectibles.
GME shares have tumbled 28% since Cohen first offered to buy eBay in May. The $125 per share proposal consisted of 50% cash and 50% GameStop common stock.
eBay shares closed Friday near $112 per share, commanding a market value of $49.8 billion. Including debt, eBay is valued at almost $54 billion. GameStop’s market value stands at around $8.6 billion.
Cohen continued building the eBay stake, and as of July 15, owned 9.75%, making him the second-largest shareholder, only to Vanguard Group. Data compiled by Bloomberg shows that stake around 8.55%.
Cohen will likely use GameStop’s stake as leverage, though which path he ultimately pursues from here remains to be seen.
