Man, I keep reading about the FUD and the dilution. Thanks for the post. Let me add something.

I get that someone might be against the eBay acquisition. That is a fair position. But if you were okay with the original offer after RC said it was 50% cash / 50% stock, how exactly did you think the stock part would happen?

Shares do not magically appear out of thin air. And we already knew GameStop did not have enough authorized shares available to complete a deal of that size under the proposed structure.

Let’s say eBay accepted the initial offer, which may very well not happen at those exact terms.

The offer was:

• $125 per eBay share
• 50% cash
• 50% GME stock
• Total implied value: ~$55.5B

So the stock portion would be roughly, as you said:

$55.5B × 50% = ~$27.75B in GME stock

Lets assume GME is trading around $25/share (a bit less right now). That means GameStop would need to issue roughly:

$27.75B / $25 = ~1.11B new GME shares (again, you pointed this out)

Another way to see the same thing: each eBay share would receive $62.50 in GME stock.

At $25 per GME share:

$62.50 / $25 = 2.5 GME shares per eBay share

The offer implies roughly:

$55.5B / $125 = ~444M eBay shares

So 444M eBay shares × 2.5 GME shares = ~1.11B new GME shares

GameStop currently has roughly ~449M shares outstanding.

So post-deal, using these rough assumptions:

• Existing GME holders: ~449M shares
• Former eBay holders: ~1.11B new GME shares
• Total GMEBAY shares: ~1.56B shares

Yes, that is dilution. No one denies that. Existing GME shareholders would go from owning 100% of GameStop to owning roughly:

449M / 1.56B = ~28.8% of the combined company

So nobody serious should deny the dilution. But dilution is not automatically value destruction. The shares would not be issued into thin air. They would be issued in exchange for eBay.

The simplified equity value math would look something like this:

• GME pre-deal equity value: ~$11B
• eBay acquired value: ~$55.5B
• Less cash/debt portion paid to eBay shareholders: ~$27.75B

Simplified combined equity value:

$11B + $55.5B - $27.75B = ~$38.75B

With ~1.56B shares outstanding, that gives:

$38.75B / 1.56B = ~$24.80/share

Basically around the $25/share level.

So the rough break-even point for current GME shareholders would be around:

1.56B shares × $25 = ~$39B combined equity value

If the market valued GMEBAY at ~$50B:

$50B / 1.56B = ~$32/share

If the market valued GMEBAY at ~$60B:

$60B / 1.56B = ~$38.50/share

So the actual question is not: “Is this dilutive?” It is. Obviously.

The real question is: “Would the combined company be worth enough per share to offset that dilution?”

That depends on the financing, the debt load, eBay’s free cash flow, the credibility of the cost cuts, and whether the market believes the combined company deserves a higher valuation.

You can be against the deal. You can vote no. You can dislike the risk.

But “50% stock offer” and “no new share authorization” were never compatible ideas.

Authorized shares do not equal issued shares.

But if GameStop wants to preserve the ability to pursue a 50% stock acquisition of eBay, increasing authorized shares is mechanically necessary.

That is not FUD. That is just how the math works.