GameStop makes $55.5bn takeover offer for eBay

Video game retailer GameStop has made a surprise $55.5bn (£40.9bn) offer to buy e-commerce giant eBay.

The cash and stock offer values eBay at $125 a share, $20 more than the company's value when trading ended in New York on Friday.

GameStop's chief executive, Ryan Cohen, said eBay could be worth much more under his leadership and even rival Amazon.

He also said he was prepared to take his bid directly to shareholders if eBay's board rejected it. eBay said it would consider the proposal.

Analysts at Morgan Stanley expressed doubts about a potential deal, saying the two companies had "fundamentally different" business models.

GameStop rose to prominence during the Covid-19 pandemic when it became the centre of the so-called meme stock craze.

This saw retail investors buy up shares in unloved companies that professional investors had bet against, causing their share price to rise and fall sharply.

The chain still has around 1,600 outlets in the US and has seen something of a turnaround under Cohen.

Its net profit rose to $418.4m in 2025 - up from $131.3m the previous year - although sales fell.

eBay, which is worth about four times more than GameStop, was launched in 1995 as a marketplace for hobbyists and became one of tech's best-known brands.

But its user base has shrunk amid competition from the likes of Amazon. It currently has 136 million users worldwide, down from 175 million in 2018.

Under the proposed deal to buy eBay, Cohen would become the chief executive of the new firm and receive no salary or bonuses, being "compensated solely based on the performance of the combined company".

GameStop, which currently has a stock market valuation of around $11.9bn, said it has a commitment letter from TD Securities to provide around $20bn in debt to help finance the deal.

Cohen said he planned to cut costs at eBay by $2bn within a year of the deal being completed.

This would mainly fall across eBay's sales and marketing division, which GameStop said had failed to attract more users to a "marketplace with near-universal brand recognition".

The proposal does not sound like a "terribly good offer" as it would saddle eBay with GameStop's debt, said Sucharita Kodali, a retail analyst at research firm Forrester.

It makes sense for GameStop because it could lift its valuation by being linked with a larger company like eBay, she told the BBC.

"The truth is, we are not necessarily putting two strong companies together," Kodali added.

Shares in eBay rose by 5.5% on Monday morning in New York, while GameStop fell by more than 4%.

GameStop's shops would give eBay a national network for its "live commerce" and other business operations, Cohen said.

Cohen, who became the GameStop boss in 2023, has criticised its slow shift into e-commerce.