Quick overview

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GameStop has launched a bold $55.5 billion bid to acquire eBay, aiming to build a credible challenger to Amazon. But the proposal has sparked skepticism across Wall Street—and a televised interview with CEO Ryan Cohen only added to the uncertainty.

A Surprise Mega-Deal Proposal

Wall Street kicked off the week with news that GameStop had submitted a non-binding offer to acquire 100% of eBay at $125 per share, valuing the deal at approximately $55.5 billion.

The proposed transaction would be structured as a 50/50 mix of cash and stock, representing a 46% premium over eBay’s closing price on February 4—the date when GameStop began building its position in the company.

According to GameStop, the acquisition is part of a broader strategy to reposition eBay as a direct competitor to Amazon, leveraging its own retail footprint and logistics capabilities to scale a more integrated e-commerce platform.

Financing the Ambition

GameStop has reportedly built a roughly 5% stake in eBay through a combination of shares and derivatives. To fund the deal, the company plans to use nearly $10 billion in cash on hand, alongside up to $20 billion in external financing.

The scale of the bid has raised eyebrows, particularly given the gap between GameStop’s market capitalization and the size of the proposed transaction.

From Meme Stock to Strategic Buyer

GameStop rose to global prominence in 2021 as one of the most notable “meme stocks,” fueled by coordinated retail investor activity on platforms like Reddit and Robinhood. The surge triggered massive volatility and inflicted heavy losses on several hedge funds.

Since then, the company has undergone a significant transformation under Ryan Cohen, focusing on cost discipline and balance sheet repair.

Deal Structure and Expected Synergies

Under the proposal—subject to shareholder and regulatory approval—eBay investors would be able to choose between cash or GameStop stock, on a prorated basis.

GameStop argues the offer also reflects a 27% premium to eBay’s 30-day volume-weighted average price and 36% over its 90-day average.

A central pillar of the strategy is an aggressive cost-cutting plan. The company estimates it could generate $2 billion in annual savings within the first year post-acquisition, including:

• $1.2 billion from sales and marketing
• $300 million from product development
• $500 million from general and administrative expenses

GameStop has criticized eBay’s $2.4 billion marketing spend in 2025, arguing it failed to deliver meaningful user growth, with active buyers increasing by just one million to 135 million.

Based on these efficiencies alone, GameStop projects eBay’s earnings per share could rise from $4.26 to $7.79 in the first year.

Leveraging Physical Retail

Another key component of the plan is the integration of GameStop’s approximately 1,600 U.S. stores into eBay’s operations. These locations could serve as hubs for product authentication, logistics, order fulfillment, and even live commerce initiatives.

If completed, Ryan Cohen—who has led GameStop since 2021—would become CEO of the combined entity.

Under his leadership, the company has swung from $380 million in net losses to nearly $420 million in profits by 2025, driven largely by aggressive cost reductions. Cohen, who owns roughly 9% of the company, does not receive a salary or cash bonus, with compensation tied entirely to performance.