GameStop has proposed a $55.5 billion acquisition of eBay, offering $125 per share, a 20% premium over its last closing price. The retailer has already built a roughly 5% stake in eBay, signaling serious intent ahead of the formal proposal.

The deal would be financed through a combination of cash and GameStop stock. The company also secured a reported $20 billion debt commitment from TD Bank to support the transaction.

An Ambitious Bid Despite Size Gap

The proposed takeover stands out for its scale. GameStop's market capitalization sits near $11.9 billion, far smaller than eBay's valuation of about $46 billion. The attempt to acquire a company nearly four times its size marks one of the more aggressive moves in recent corporate dealmaking.

Ryan Cohen Outlines Cost-Cutting Strategy

GameStop CEO Ryan Cohen has positioned the bid as a turnaround plan. In a letter to eBay, Cohen pledged $2 billion in annual cost reductions within a year of closing.

The strategy targets multiple areas, including a $1.2 billion cut in sales and marketing expenses. Cohen argued that increased spending has not translated into meaningful user growth, citing fewer than 1 million new active buyers in fiscal 2025. Additional cuts include $500 million in general and administrative costs and $300 million in product development.

GameStop estimates these changes could lift eBay's earnings per share from $4.26 to $7.79 within the first year.

Leadership and Future Direction

Cohen has offered to lead the combined entity as chief executive, stating he would forgo salary, bonuses, and severance, tying compensation entirely to performance.