GameStop has sent shockwaves through the business world by submitting a $55.5 billion non-binding proposal to acquire eBay, a move that would transform the video game retailer into a massive e-commerce platform. The offer values eBay at $125 per share — a split of cash and stock — representing roughly a 20% premium over eBay’s recent trading price and a 46% premium compared to its closing price on February 4, the day GameStop began quietly accumulating eBay shares. GameStop now holds approximately 5% of eBay’s outstanding stock, making it one of the online marketplace’s largest shareholders.
CEO Ryan Cohen, who would lead the combined entity, has framed the deal as an opportunity to turn eBay into a “legit competitor to Amazon.” Cohen has pledged to forgo any salary, cash bonuses, or golden parachute, tying his compensation entirely to the performance of the merged company. He told The Wall Street Journal that eBay is drastically underperforming relative to its spending and could be worth “hundreds of billions of dollars” under his leadership.
Financing the deal presents a formidable challenge for a company with a market capitalization of roughly $12 billion attempting to swallow one valued at $46 billion. According to GameStop’s announcement, the cash portion would be funded through approximately $9.4 billion in existing cash and liquid investments, combined with up to $20 billion in debt financing arranged through TD Securities. Cohen has indicated that additional capital could come from Middle Eastern sovereign wealth funds and potentially new stock issuances.
At the heart of Cohen’s pitch is a plan to slash $2 billion in annual costs within 12 months of closing, targeting $1.2 billion in sales and marketing reductions, $300 million from product development, and $500 million from general and administrative expenses. He has argued that eBay’s current management structure creates “perverse financial incentives” and that the marketplace could be run far more efficiently. Cohen also envisions leveraging GameStop’s 1,600 U.S. retail locations as physical hubs where eBay sellers could have items authenticated, graded, and listed with a trust badge — a natural extension of GameStop’s existing work inspecting trading cards and gaming hardware.
The proposal also reflects Cohen’s broader vision for GameStop’s evolution beyond traditional video game sales. With the company already pivoting toward higher-margin products like trading cards and retro gaming collectibles, integrating eBay’s vast online marketplace could dramatically expand its reach. Cohen has suggested that eBay should embrace live-commerce streaming to drive sales, further bridging the gap between physical retail and digital commerce. If eBay’s board rejects the offer, Cohen has warned that he will take his case directly to shareholders.
eBay has acknowledged receiving the unsolicited proposal and said its board of directors will review it alongside financial and legal advisors to determine the best course of action for shareholders. The company urged its investors to take no immediate action. Should the deal ultimately succeed, Cohen stands to gain as much as $35 billion in stock compensation if the combined company’s market value reaches $100 billion — a payout that would either validate one of the boldest corporate gambles in recent memory or, as Cohen himself put it in January, prove to be “totally, totally foolish.”