GameStop Makes $55.5 Billion Unsolicited Bid for eBay in Reverse Takeover

GameStop has made an unsolicited, non-binding offer to acquire eBay for $125 per share, valuing the online marketplace at roughly $55.5 billion in a cash-and-stock deal that would combine the meme-stock retailer with a company roughly four times its size.

The Details

The proposal, delivered to eBay board chair Paul Pressler, is split evenly between cash and GameStop common stock and represents a 20% premium to eBay's closing price of $104.07 on Friday. eBay confirmed receipt of the unsolicited proposal on Monday and said its board would review it carefully alongside financial and legal advisors. The company noted it had no prior discussions with GameStop before receiving the offer.

GameStop has quietly accumulated roughly a 5% stake in eBay since February 4, consisting primarily of derivatives alongside some common stock. The Wall Street Journal first reported the bid on Sunday evening. On Monday morning, eBay shares opened around $109, significantly below the $125 offer price.

To finance the acquisition, GameStop has secured a $20 billion financing letter from TD Securities and holds approximately $9.4 billion in cash. The remaining portion of the deal would be funded by issuing additional shares. GameStop's market value is approximately $11 to $12 billion, while eBay's is about $46 billion, making this a reverse takeover of a company far larger than the bidder. If completed, the transaction would rank as the largest leveraged buyout on record, surpassing the recently announced $55 billion Electronic Arts transaction, according to Morgan Stanley.

GameStop chief executive Ryan Cohen has pledged to cut $2 billion in annual costs within a year, targeting eBay's $2.4 billion sales and marketing budget. In his letter to Pressler, Cohen wrote that "more spend is not producing more users on a marketplace with near-universal brand recognition." He projected that eBay's earnings per share would rise from $4.26 to $7.79 under the new structure.

Cohen told the Wall Street Journal that "Ebay should be worth – and will be worth – a lot more money," adding that he was "thinking about turning eBay into something worth hundreds of billions of dollars" and that "it could be a legit competitor to Amazon." During a CNBC interview on Monday, he defended the financing plan, stating, "We are offering half cash, half stock, and we have the ability to issue stock in order to get the deal done."

Cohen also threatened to take the offer directly to eBay shareholders in a proxy fight if the board is not receptive. He said he would serve as chief executive officer of the combined company if the transaction closes.

Market reaction signaled deep skepticism. eBay shares climbed only about 5% to 6% to roughly $109 to $110 on Monday, well below the $125 offer price, indicating investors doubt the deal will close.

Michael Burry, the investor known for predicting the 2008 housing collapse and a former backer of Cohen, sold all his GameStop shares and criticized the strategy as "pedestrian." In a Substack post, Burry warned the deal would bring more debt and shareholder dilution and argued the true intent was not to compete with Amazon but to dominate collectibles and used goods. "Ryan's attempt to take over eBay cannot possess the actual honest and true intent to compete with Amazon," Burry wrote. "Rather clearly, the intention must be to dominate collectibles and used goods of all ages." Morgan Stanley analysts called the two companies' business models "fundamentally different," according to Reuters.

Context

GameStop became a "meme stock" in January 2021 when retail traders on Reddit's WallStreetBets sent its shares up 1,500% in two weeks, drawing global attention to the video game retailer. Cohen, who founded online pet supply retailer Chewy and sold it to PetSmart for $3.35 billion in 2017, later built a large stake in GameStop and took over as chief executive in 2023.

The bid follows a public hint from Cohen on January 30, when he told CNBC that GameStop was pursuing a "transformational" consumer mega-deal. Earlier, on January 7, GameStop unveiled Cohen's compensation package, which includes stock options that could be worth more than $35 billion if GameStop reaches a $100 billion valuation.

eBay's gross merchandise volume peaked at $100 billion in 2020 and declined to $79.6 billion in 2025. The company has been pivoting toward focus categories and artificial intelligence investments under chief executive Jamie Iannone and recently announced the acquisition of Depop from Etsy for $1.2 billion.

Several outlets cited slightly different valuation figures for the deal. The $55.5 billion calculation reflects $125 per share multiplied by eBay's outstanding shares, while $56 billion is a rounded headline figure used by the Wall Street Journal, Bloomberg, and Reuters.

What's Next

eBay's board is reviewing the unsolicited proposal with its financial and legal advisors. The company has not provided a timeline for its response. Cohen has indicated he is prepared to bypass the board and appeal directly to eBay shareholders through a proxy fight if the offer is rejected. The wide gap between eBay's trading price and the proposed $125 per share offer suggests investors are pricing in significant uncertainty about whether the deal can secure financing, regulatory approval, and shareholder support.