eBay on Tuesday formally rejected GameStop's $55 billion takeover proposal, dismissing the cash-and-stock offer as "neither credible nor attractive." The online marketplace declined the bid from the gaming retailer, which is nearly four times smaller. eBay chairman Paul Pressler outlined serious concerns about financing and the massive debt burden the transaction would create for the company.

The proposed deal would balloon eBay's debt from $7 billion to $31 billion, prompting Moody's to label the acquisition "credit-negative." GameStop CEO Ryan Cohen initially provided limited details on financing beyond a non-binding letter from TD Bank expressing confidence in raising $20 billion. eBay disputed claims the combined entity would achieve investment-grade credit status as suggested by GameStop.

GameStop shares fell 2.4% in premarket trading following the rejection, while eBay declined 1%. The decision comes as eBay's stock has surged 55% over the past year while GameStop's has dropped 16%. Cohen had proposed eBay shareholders exchange approximately half their shares for combined company stock, potentially granting them majority ownership. GameStop recently sought to double its authorized shares, signaling potential efforts to fund future acquisitions.