GameStop Bids $56B for eBay to Fight Amazon

GameStop has made an unsolicited $55–56 billion bid for eBay — $125 a share, a 20 percent premium. CEO Ryan Cohen wants to fold eBay's marketplace into GameStop's 1,600 U.S. stores, turning them into physical drop-off and shipping hubs and live-commerce studios to build an Amazon rival. Cohen quietly built a 5 percent stake in eBay since February before going public with the offer, which is either a bold strategic pivot or a meme-stock gambit depending on how charitable you're feeling. The obvious problem is financing: GameStop is bidding for a company nearly four times its own size, with only a $20 billion financing letter from TD Bank in hand against a $56 billion price tag. eBay shares jumped over 8 percent on the news; GameStop fell 3 percent, which tells you exactly what the market thinks about who benefits. Cohen promises $2 billion in annualized cost cuts within a year of closing, a number that requires an enormous number of things to go exactly right. This is the most ambitious reinvention any legacy gaming retailer has attempted in a generation — or it's a headline that looks absurd in 18 months.