U.S. video game retailer GameStop announced Sunday it has made an unsolicited, non-binding offer to acquire eBay for $125 per share in a cash-and-stock deal, valuing the e-commerce platform at roughly $55.5 billion.
The offer, split evenly between cash and GameStop common stock, represents a 20% premium to eBay’s Friday close of $104.07, and a 46% premium to its closing price on Feb. 4 — when the gaming retail giant started building a stake in the company, GameStop said in its statement.
Shares of eBay surged as much as 13.4% in after-hours trading to around $118, well below GameStop’s $125 offer, suggesting investors are skeptical the deal will close.
GameStop, which became a so-called “meme stock” during a 2021 retail frenzy that drove sharp gains in its shares, jumped around 4% to $27.6 per share.
The announcement came as GameStop Chief Executive Ryan Cohen told the Wall Street Journal that he saw a path to make the e-commerce company a much bigger competitor to Amazon.com.
“EBay should be worth — and will be worth — a lot more money,” Cohen said. “I’m thinking about turning eBay into something worth hundreds of billions of dollars.”
GameStop has built a roughly 5% stake in eBay and secured a commitment letter from TD Bank for up to $20 billion in debt financing to make the deal possible, according to its statement. The remainder of the deal would be funded from its approximately $9.4 billion cash pile.
The proposal is subject to approval from eBay’s board of directors, regulators, and shareholders from both companies. EBay did not immediately respond to a CNBC request for comment.
Audacious bid
Both companies have struggled to adapt to shifting consumer preferences, and it remains unclear whether eBay’s board will view GameStop — whose own market capitalization stood at roughly $11 billion before the news broke — as a credible acquirer for a company four times its size.
GameStop had a market value of $12 billion while eBay was much larger at around $46 billion, as of Friday, according to LSEG data, raising questions about the feasibility of the bid.
Cohen told the Journal he is prepared to take the offer directly to shareholders in a proxy fight if necessary. Should the deal close, Cohen is expected to serve as Chief Executive Officer of the combined company, according to GameStop’s statement.
Cohen first hinted in January at plans to acquire a publicly traded consumer company larger than GameStop, telling CNBC at the time that the deal would be “transformational” and “never been done before within the history of the capital markets.”
“It’s gonna be really big. Really big. Very, very, very big,” Cohen said of the size of the acquisition.
The Canadian entrepreneur built his reputation by founding Chewy, an online pet supply retailer that was sold to PetSmart for $3.35 billion in 2017. He later gained a cult following after building a large GameStop stake, and in late 2020, criticized the company for moving too slowly toward e-commerce, arguing that the video-fame retailer could reposition itself as the Amazon of the gaming industry.
He joined GameStop’s board in Jan. 2021, just as retail traders on Reddit’s WallStreetBets forum rallied behind the stock, sending shares 1,500% higher in two weeks, in one of modern markets’ most chaotic episodes.
Cohen stepped up as CEO in Sep. 2023, steering the company back to profitability through aggressive cost cuts and the closure of hundreds of stores.
In its offer, GameStop said it would cut $2 billion in annual costs within a year, targeting eBay’s bloated sales and marketing budget, which totaled $2.4 billion in fiscal 2025 while net active buyer growth remained flat at less than 0.75%.
“More spend is not producing more users on a marketplace with near-universal brand recognition,” the statement said.
The company projected that cost reductions alone would lift eBay’s earnings per share, measured under standard U.S. accounting rules, to $7.79 from $4.26 in the first year.
GameStop also pitched its roughly 1,600 U.S. retail stores as physical infrastructure for eBay’s marketplace, offering a network for authentication, intake, fulfillment, and live commerce capabilities.
Cohen’s compensation package, adjusted at the beginning of the year, also gave him an additional incentive to boost the company’s market value and profitability.
In January, GameStop outlined a compensation package for Cohen comprising stock options tied to performance targets, including market capitalization and earnings thresholds. Based on the structure, the options could be worth more than $35 billion if the company reaches a $100 billion valuation and meets profit targets.
EBay, meanwhile, has spent years losing ground to Amazon and a new generation of specialized secondhand marketplaces. After peaking at $100 billion in gross merchandise volume in 2020, eBay’s GMV slid to $79.6 billion in 2025, as the platform struggled to retain buyers.
