TLDR
- Ryan Cohen has submitted a bold $56 billion unsolicited proposal to acquire eBay, pricing shares at $125 each — approximately 20% above Friday’s closing price.
- The proposed acquisition features a 50-50 split between cash and GameStop equity, supported by a committed $20 billion financing package from TD Securities.
- Cohen has accumulated a 5% ownership position in eBay and warns he’ll bypass the board to appeal directly to shareholders if they refuse to negotiate.
- The GameStop chief executive pledges to eliminate $2 billion in annual expenses within one year and envisions creating a legitimate Amazon competitor.
- Monday’s premarket session saw eBay shares spike over 8% while GameStop climbed more than 6%.
In an unexpected Sunday announcement, GameStop’s CEO Ryan Cohen delivered an unsolicited acquisition proposal to eBay’s leadership, offering approximately $56 billion for the online marketplace giant.
Cohen’s bid prices eBay shares at $125 each, representing roughly a 20% markup over Friday’s market close. Monday’s premarket activity reflected investor enthusiasm, with GameStop climbing more than 6% and eBay jumping over 8%.
The financing arrangement splits evenly between cash and GameStop equity. According to Cohen, GameStop holds approximately $9.4 billion in cash and liquid assets as of January 31, with remaining funds to come through debt instruments and external capital sources.
Demonstrating serious intent, Cohen has locked in a $20 billion debt commitment from TD Securities, the investment banking division of TD Bank. Additional funding may come from Middle Eastern sovereign wealth funds, the Wall Street Journal reports.
Ahead of this announcement, GameStop quietly assembled a 5% stake in eBay using both direct stock purchases and derivative instruments.
Hostile Takeover Warning Issued
Cohen isn’t planning a quiet retreat if rejected. In conversations with the Wall Street Journal, he confirmed his willingness to pursue a hostile approach — circumventing eBay’s board to present the offer directly to shareholders.
He has also indicated his intention to lead the merged entity as CEO following any successful transaction.
Cohen contends the combination could slash $2 billion from eBay’s annual operating costs within twelve months. He’s identified excessive sales and marketing expenditures as primary targets for reduction.
GameStop’s network of approximately 1,600 brick-and-mortar locations across America would transform into hubs for product authentication, order fulfillment, and live commerce streaming, according to Cohen’s letter to eBay’s directors.
“It could be a legit competitor to Amazon,” Cohen said of a combined eBay and GameStop.
David Versus Goliath Acquisition Attempt
The financial scale here is remarkable. eBay carried a market valuation near $46 billion when markets closed Friday. GameStop’s valuation stood at approximately $12 billion. This creates one of the more unusual merger scenarios in contemporary corporate history.
Cohen built his reputation through unconventional strategies — he gained widespread attention during 2021’s meme stock phenomenon and joined GameStop’s board that same January before ascending to CEO and implementing aggressive cost reductions that restored profitability.
Yet operational challenges persist. GameStop disclosed a 14% revenue decline for its most recent quarter last month. The company’s traditional physical retail model continues struggling as gaming increasingly moves toward digital distribution.
eBay’s recent performance tells a different story. The marketplace platform exceeded Wall Street’s revenue expectations in its latest guidance, powered by strong performance in collectibles, automotive parts, and livestreamed auction events.
Year-to-date performance prior to this announcement showed GameStop and eBay shares advancing 32.1% and 19.5% respectively.
eBay has not yet issued a public response to the acquisition proposal.
