GameStop stock is plummeting after its CEO's bizarre interview left investors feeling uncertain about his eBay plans

On Sunday, May 3, GameStop (NYSE: GME) announced it had made an unsolicited connection to get the planetary online marketplace eBay for astir $55.5 cardinal (1). CNBC interviewed Gamestop CEO Ryan Cohen the pursuing day, asking him to explicate to the assemblage however GameStop could realistically spend to bargain retired and tally eBay, which is simply a overmuch larger company.

His answers came disconnected arsenic rude, awkward, defensive, and yet unhelpful. If Cohen was hoping to triumph implicit investors with his answers, helium was successful for a rude awakening. After, the gaming retailer's banal dropped implicit 10% aft Cohen's interrogation connected CNBC's quality programme Squawk Box (3).

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Here's wherefore investors consciousness connected borderline aft Cohen's interview.

Ryan Cohen won't explicate the mathematics down acquiring eBay

In the Squawk Box interview, co-anchor Andrew Ross Sorkin asks for details connected however GameStop would travel up with the funds for the $55.5 cardinal bid.

"Half cash, fractional stock, but the details are connected our website," Cohen answers (4).

Sorkin responds by laying retired the math. Using rounded numbers, helium explains that GameStop's marketplace headdress was astir $11 billion, and it has astir $9 cardinal successful currency reserves. TD Securities has provided GameStop with a $20 cardinal financing missive (2). But this inactive leaves the institution astir $15 oregon $16 cardinal abbreviated of its bid.

Sorkin points retired that adjacent though TD's missive states that it's assured it could supply the $20 billion, it's not a locked-in deal.

"Yeah, we'll spot what happens," Cohen says, eliciting an uncomfortable laughter from Sorkin (5).

"I perceive you. I recognize that. I'm conscionable trying to recognize wherever the remainder of the wealth would travel from," Sorkin replies.

The interrogation continues, with Sorkin and co-anchor Becky Quick asking for basal details, and Cohen repeatedly saying that the bid volition dwell of fractional cash, fractional stocks, and that radical tin spell to the website for details.

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Investors are skeptical that the woody could spell done

In the interview, Cohen confirms that helium didn't scope retired to eBay earlier placing a bid publicly, and eBay hasn't explicitly stated that it wants to sell. When Sorkin asks wherefore helium didn't attack eBay directly, Cohen says, "For evident reasons. eBay is simply a nationalist company. There's each kinds of perverse fiscal incentives, from the committee to the absorption team. So there's lone 1 mode to attack thing similar this (6)."