Shares of eBay are surging in premarket trading on Monday after GameStop, led by Ryan Cohen, announced a takeover bid worth approximately $56 billion. The move is seen as a strategy to challenge online retail giant Amazon.
GameStop's Proposal
The national gaming retailer, which operates around 1,600 U.S. stores, outlined plans to transform these locations into drop-off and shipping hubs for eBay. One proposal includes live sales broadcasts from GameStop stores featuring eBay products. Cohen stated in a CNBC interview, "EBay has the second largest commerce franchise and there's a big opportunity to do something much larger."
GameStop's bid values eBay at $125 per share in cash and stock, with an equity value of $55 billion. The company disclosed that it began accumulating eBay shares in February and now holds a 5% stake.
Cost-Cutting Measures
GameStop aims to reduce costs at eBay, noting that the online marketplace spent $2.4 billion on sales and marketing in fiscal 2025 while adding only 1 million net active buyers. The company claims it can achieve $2 billion in annualized cost savings within a year of closing the deal.
Leadership and Compensation
Cohen, who owns about 9% of GameStop, would become CEO of the combined entity. His compensation would be tied solely to the performance of the merged company. Cohen took the helm at GameStop in 2023, a period marked by leadership instability as the company grappled with the impact of streaming on the gaming industry.
GameStop gained fame as a meme stock in 2021 when retail investors drove its share price up by 1,000% in two weeks. While shares have since declined, they remain up more than 30% year-to-date. In response to the bid, eBay shares jumped over 8% in premarket trading, while GameStop's stock fell more than 3%.
