Gotrade News - GameStop launched an unsolicited takeover bid for eBay worth roughly $56 billion on Sunday (3/5). Markets reacted fast, with eBay shares jumping more than 13% in after-hours trading on the report.
The offer comes from GameStop CEO Ryan Cohen and stands out because GameStop is only a quarter of eBay size. Retail investors are again watching two familiar names that had cooled off in the U.S. stock market.
Key Takeaways
- GameStop offered $125 per share in a 50-50 mix of cash and stock.
- The bid carries a 20% premium to eBay Friday close price.
- Cohen is ready to launch a proxy fight if the eBay board rejects the proposal.
The Wall Street Journal first reported the bid on Sunday evening New York time. GameStop had already built a position of about 5% in eBay before submitting the formal acquisition proposal.
GameStop currently has a market cap of roughly $11.8 billion, far below eBay $46 billion. The structure is rare because the acquirer is much smaller than the target it is now pursuing.
Cohen has secured a financing commitment from TD Bank for about $20 billion in long-term debt. Additional backing reportedly comes from several Middle Eastern sovereign-wealth funds with deep capital pools.
Cohen stated that eBay should be worth far more than its current market price reflects today. He targets transforming eBay into a company valued in the hundreds of billions of dollars over time.
The core strategy leverages GameStop physical stores as collection and authentication points for valuable items. Cohen also plans to expand eBay live commerce through real-time interactive video streaming products globally.
Market Reaction and Cohen Position
Shares of GameStop also gained meaningfully after the bid report surfaced publicly to the market. Investors see potential synergy between the collector customer bases of both companies in collectibles trading.
eBay had recently posted strong operational momentum, with revenue forecasts beating Wall Street consensus expectations. That strengthens the narrative that eBay still has significant room to grow over coming years.
Cohen previously founded Chewy, the pet supply e-commerce company that became a major industry success. He is known as an activist investor who aggressively pushes strategic change at every target company.
If the eBay board rejects the formal bid, Cohen is prepared to bring the proposal directly to shareholders. A proxy fight scenario could stretch this corporate battle over several quarters without any quick resolution.
Implications for Retail Investors
The 20% premium signals that Cohen strongly believes eBay is undervalued at its current trading prices. The premium versus the February 4 close even reaches 46%, showing the aggression of the offer terms.
For global retail investors, this echoes the 2021 GameStop saga that shook the U.S. stock market. Volatility in GME and EBAY shares could spike sharply during the coming weeks of trading sessions.
For traders watching U.S. stocks closely, GME and EBAY belong on the watchlist this week. Market sentiment around mega-deals like this can open interesting trading windows for sharp retail investors.
Sources
Investing.com, GameStop CEO Ryan Cohen makes unsolicited offer to buy eBay for about $56 billion, WSJ says, 2026.
Fortune, EBay soars on report that GameStop is preparing a takeover bid, 2026.
