GameStop is acquiring more EBAY at a discount….
OG 21 Ape here checking in. So many things have recently happened it’s making my head spin. I want to try and compile this into what I believe is going to be an insane value add to our investment, and try to put this into a simple bigger picture.
***Here’s what we know:***
-RC has announced Gamestop has accumulated a 5% position into EBAY, making them one of the largest shareholders.
-RC has made a non-formal bid to buy EBAY at a 40%+ premium to when GameStop started buying, of $125 per share, in a 50/50 share and cash deal.
-As RC “expected”, EBay rejected the offer. Essentially saying that it was not beneficial enough for the C-Suite and Board, who would inevitably be cut on Day 1 with RC’s proposal. He literally called them all out, said “I want your company and you will all be relieved immediately”. So obviously, they rejected the deal (EBay board makes $4 million per year, CEO makes $30 Million per year).
-RC has announced that he will “do whatever he has to do” to get EBay. These are not small words coming from a 30 yo billionaire genius. When he wants something, he gets it.
-Then, we are seeing GME tank (right on cue) and now EBay is up 15% this month.
***What I believe is happening:***
-GameStop has began accumulating again, and this is why we are seeing the price and volume rise. Anything under $125 a Share *is a discount* to RC.
-GameStop is also issuing shares currently to buy more EBAY. Which I think is incredibly smart. We have already seen what happens when RC issues Billions of dollars worth of shares: The Price Goes Up. I believe they are currently selling to the market. At current prices 5.5 GME buys us 1 EBAY.
-Let’s be very clear: This is absolutely Accretive to Investors. Your shares are not “diluting” as the shills want you to believe. Our shares being sold are literally increasing our value every dollar that EBay goes up. This is value immediately showing on our balance sheet.
-I believe GameStop will continue to buy shares at a discount with the $9 Billion War Chest that has already been deemed for the EBay deal at $125. Using it now, buys us more shares at the lower price. RC: Deploy it now!
-Along with the shares issued and War Chest deployment to accumulate shares, GameStop will then control 15% of the shares, making them the largest stakeholder (largest Vote).
-But here’s where it gets tricky: Another Ape pointed out that EBay’s corporate structure makes it difficult to own more than 15%, and when that happens, it triggers legal issues which could delay the M&A. Maybe someone can shed more clarity on this in the comments…
-So we know that GameStop cannot hold more than 15% without causing issues. But that doesn’t mean that RC Ventures can’t add a position. We know he has freed up capital in the recent years by selling off his Apple Position. He has mentioned that he has had an eye on EBay “for years”. Was this apart of his plan, and the reason he needed to divest Apple?
-They have estimated the Power Pack business alone could generate up to tens of Billions in profits if paired with the EBay inventory and platform. I believe this pairing with the rest of the platform and GameStops physical footprint combined could create a company much much larger than what they both are today. A couple hundred billion market cap is actually achievable in the near future, and this is not a meme.
RC only needed a 10% position in GME to recreate the entire company. What position will he need in EBay to be able to deliver those same results?