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 \u2014 when the gaming retail giant started building a stake in the company, GameStop said in its statement. <\/p>\n
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.<\/p>\n
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. <\/p>\n
The announcement came as GameStop Chief Executive Ryan Cohen told the Wall Street Journal<\/a> that he saw a path to make the e-commerce company a much bigger competitor to Amazon.com<\/a>. <\/p>\n Stock Chart IconStock chart icon eBay<\/p>\n “EBay should be worth \u2014 and will be worth \u2014 a lot more money,” Cohen said. “I’m thinking about turning eBay into something worth hundreds of billions of dollars.” <\/p>\n 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<\/a>. The remainder of the deal would be funded from its approximately $9.4 billion cash pile. <\/p>\n Stock Chart IconStock chart icon 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.<\/p>\n Audacious bid<\/p>\n Both companies have struggled to adapt to shifting consumer preferences, and it remains unclear whether eBay’s board will view GameStop \u2014 whose own market capitalization stood at roughly $11 billion before the news broke \u2014 as a credible acquirer for a company four times its size.<\/p>\n 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.<\/p>\n 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. <\/p>\n Cohen first hinted in January at plans to acquire a publicly traded consumer company larger than GameStop, telling CNBC<\/a> at the time that the deal would be “transformational” and “never been done before within the history of the capital markets.”<\/p>\n “It’s gonna be really big. Really big. Very, very, very big,” Cohen said of the size of the acquisition. <\/p>\n 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<\/a>. 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<\/a>. <\/p>\n 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<\/a>, in one of modern markets’ most chaotic episodes.<\/p>\n Cohen stepped up as CEO in Sep. 2023<\/a>, steering the company back to profitability through aggressive cost cuts<\/a> and the closure of hundreds of stores. <\/p>\n 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%.<\/p>\n “More spend is not producing more users on a marketplace with near-universal brand recognition,” the statement said. <\/p>\n 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. <\/p>\n 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. <\/p>\n 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.<\/p>\n 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.<\/p>\n 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<\/a> in 2020, eBay’s GMV slid to $79.6 billion in 2025<\/a>, as the platform struggled to retain buyers. <\/p>\n![\"hide](\"https:\/\/static-redesign.cnbcfm.com\/dist\/a54b41835a8b60db28c2.svg\")
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