Overview
GameStop Chief Executive Ryan Cohen has offered few specifics beyond an assertive commitment to pursue an acquisition of eBay after the latter’s board publicly rejected his unsolicited $56 billion bid as "neither credible nor attractive." Cohen said he would do "whatever we need to do" to attempt to buy the larger e-commerce company. The offer, made in early May, proposed $125 per eBay share, with half of the consideration in cash and the remainder in GameStop stock.
Structure of the bid and financing stated by Cohen
Under the proposal, the cash portion would be funded using GameStop’s existing balance sheet, notably its $9.4 billion in cash reserves. GameStop also disclosed a non-binding commitment letter from TD Securities that could provide up to $20 billion of debt financing if the combined company were to obtain investment-grade credit ratings. Analysts on Wall Street have questioned the plausibility of winning such credit ratings for a combined entity, given the relative scale and credit profile of the two firms.
Market context and immediate reactions
eBay’s board publicly dismissed the bid, prompting bankers, investors, lawyers and industry analysts to outline possible, if challenging, ways Cohen might still attempt to take control. eBay is roughly five times the size of GameStop by many measures, and its stock performance this year and in recent years has bolstered the company’s defenses: shares have risen about 32% so far this year and the company’s market capitalization sits at roughly $51 billion following a strong first quarter driven in part by demand in high-growth categories such as collectibles and toys.
Tender offer as one path
One legal and financial route described by more than half a dozen bankers, lawyers and analysts is for Cohen to bypass eBay’s board and take the proposal directly to shareholders via a tender offer - an attempt to buy shares from investors at a premium. While relatively uncommon, tender offers can force significant negotiations and draw public attention. The article notes a precedent where a suitor used an all-cash tender offer to apply pressure despite an existing agreement between the target and a different buyer. That example underscores how a tender offer can provoke a board into reconsideration even after an initial rejection.
To succeed with a tender offer in this instance, Cohen would need to persuade some of eBay’s largest institutional shareholders to sell their holdings. Vanguard, BlackRock and State Street together own more than 22% of eBay, primarily because they manage index funds that hold the stock as part of tracked indices. Analysts cited in the coverage said it is highly unlikely these index fund managers would acquiesce to a hostile tender attempt. Don Bilson, head of event-driven research at Gordon Haskett, was quoted saying: "There is zero chance that a tender offer works," and added, "no eBay shareholder would opt into this."
Special meeting and proxy fight option
Another tactic available to Cohen would be to push for a special meeting of shareholders aimed at electing new directors sympathetic to his plan. To compel such a meeting, Cohen would need to amass a substantially larger voting stake than he currently controls. GameStop disclosed it holds 6.6% in "economic exposure" to eBay, up from roughly 5%, but that figure does not directly translate into voting power. Much of the exposure comes from put/call paired derivative contracts tied to 29 million eBay shares that would carry voting rights only if the contracts were physically settled.
At present, GameStop owns merely 25,000 eBay shares outright - about 0.006% of the company - far below thresholds typically associated with calling a special meeting, which market participants said usually requires around a 20% stake in common stock. Even if GameStop ultimately were to convert its derivatives into voting shares, the combined total would still fall well short of that informal benchmark.
GameStop has asked its own shareholders to authorize an increase in its authorized share count from 1 billion to 2.5 billion. The company framed that request in conservative terms, saying: "We view our equity as precious and do not intend to issue new shares lightly. A reserve of authorized shares ensures GameStop can act decisively when the right opportunity arises." Market observers have interpreted that filing as consistent with a plan that could involve issuing equity in some form to finance additional eBay share purchases, though the company emphasized restraint in its shareholder communication.
Public pressure and messaging
Analysts and investors noted that another lever Cohen could deploy is public pressure intended to sway directors or undercut the confidence of the eBay board. Cohen has already applied a confrontational tone in public remarks, describing eBay as needing to be "on Ozempic - it’s literally obese" during an interview with investor Anthony Pompliano and calling the company "run by a bunch of losers" in a comment to journalist Piers Morgan. Those comments are consistent with a strategy of publicly criticizing management to attempt to move shareholder sentiment.
Supporters point to Cohen’s track record as an activist and operator. He co-founded the online pet-products retailer Chewy, and he is credited with helping reposition GameStop since taking a leadership role there in 2021. Cohen helped rescue GameStop when its market valuation fell toward $250 million, and later became CEO in 2023 after serving on the board. Under his stewardship, GameStop pivoted away from being purely a video game retailer toward categories including trading cards, pursued significant share offerings and cut costs. The market has rewarded some of those changes: GameStop shares are up by more than 11% so far this year, and the company’s market capitalization sits near $11 billion. However, since Cohen joined the board in June 2021 the headline share price trajectory has been down by about 70% after accounting for stock splits.
Cohen’s history of activism and outcomes
The piece also recounted episodes from Cohen’s activist past: his 2022 campaign at Bed Bath & Beyond drew scrutiny when he sold his stake for a reported $60 million profit before the retailer issued additional shares and later filed for bankruptcy in 2023. That sequence is cited in the coverage as background on how Cohen’s activist interventions have played out in other settings, and as part of the debate about whether his approach would be effective taking on an established marketplace like eBay.
Financial profiles and margin comparisons
Analysts have also pointed to operating profitability as a substantive counterpoint to Cohen’s public criticisms of eBay’s operating performance. The article notes eBay achieved an operating profit margin of 31% in the last fiscal year - a figure highlighted by some observers as markedly higher than GameStop’s operating margin of about 10%. Those metrics are part of the argument used by some observers to contest Cohen’s characterization of eBay’s performance and operational efficiency.
Market timing and strategic patience
Several bankers and lawyers interviewed emphasized that any unwelcome bid can be a drawn-out enterprise and that Cohen is not under an immediate deadline to act. Don Bilson summed up one common view succinctly: "There is no rush." That perspective reflects the idea that a hostile or unsolicited campaign can unfold over many months or even years, involving legal maneuvers, shareholder outreach, and shifts in market sentiment.
Where things stand
Representatives for both GameStop and eBay declined to comment for the coverage. For now, Cohen’s public statements and GameStop’s filings keep multiple options alive - from a direct tender offer to an effort to build a voting position through derivative settlement or additional equity issuance, to a public campaign aimed at persuading institutional investors and board members. Wall Street watchers say these paths are difficult and face long odds, but none are precluded by the market realities detailed above.
Key takeaway
Ryan Cohen has signaled willingness to pursue an acquisition of eBay despite a firm board rejection. The mechanics of any follow-up move would require overcoming substantial financing, voting and shareholder support hurdles, and could take considerable time to play out.