GameStop (GME) is eyeing a major expansion with a proposed $55.5 billion acquisition of online marketplace eBay (EBAY), raising new questions about whether its bitcoin stakes could help finance the deal.
The video game retailer, which holds about $368 million in BTC, submitted a non-binding offer on Sunday to buy eBay for $125 per share in cash and stock. The offering represents a 46% premium to eBay’s share price in early February, when GameStop began building a position. The company said it now owns a 5% economic stake through shares and derivatives.
A deal of this size would likely require a significant amount of cash. GameStop said it expects to finance the offering using its $9.4 billion of “cash and liquid investments” on its balance sheet and up to $20 billion in financing, supported by a letter from TD Securities.
Will GameStop sell BTC?
That raises new questions about whether GameStop will sell its BTC to help pay for the deal.
The acquisition plan follows earlier comments from CEO Ryan Cohen, who said in February that he was pursuing a “very, very, very large” acquisition of a public consumer company. He described the plan as “far more compelling than bitcoin” and left open the option of selling the company’s cryptocurrency holdings to fund a deal.
GameStop revealed last month that it transferred around 4,709 BTC to Coinbase Prime, Coinbase’s flagship brokerage platform for institutions, as part of a covered call strategy, maintaining exposure to bitcoin while generating income.
The company had just over $9 billion in cash and accounted for its $368 million bitcoin stash as “accounts receivable” after the Coinbase Prime maneuver. Those items add to the balance sheet power of $9.4 billion that could be used to finance the acquisition.
In an interview with CNBC, Cohen also said the company has the “ability to issue shares to close the deal.”
GameStop did not respond to a request for comment on its plans for its bitcoin holdings as of press time.
eBay’s proposed deal would make GameStop a broader e-commerce player. It will also determine whether the company’s bitcoin remains a long-term holding or becomes a source of funding for expansion.
