The strange case of GameStop wanting to buy eBay for just under a fifth of its own value The video game company has offered $56 billion for the online resale platform

The famous American video game retail chain GameStop has submitted a $56 billion offer to acquire the company behind the equally famous eBay. However, the latter has a much higher market value than GameStop, which is worth around $12 billion, making the offer particularly risky and widely discussed. Ryan Cohen, CEO of GameStop, said that the Canadian bank TD Bank would finance part of the possible acquisition with a $20 billion loan.

Cohen later clarified that, if the proposal were accepted, half of the amount would be paid in GameStop shares, while it remains unclear where the rest of the money would come from: the Wall Street Journal, which broke the story exclusively, claims that it could come from Middle Eastern sovereign wealth funds.

eBay last February acquired the app Depop from Etsy (an e-commerce platform specializing in handmade and vintage products), one of the most popular services for buying and selling second-hand clothing. In this way, the platform aims to better attract younger customers: the operation cost eBay $1.2 billion.

Why has GameStop targeted eBay specifically?

GameStop and eBay have many business activities in common: thanks to Cohen, who has been the company’s CEO since 2023, the video game chain has progressively focused on online sales, reducing the central role of physical stores. For this reason, GameStop had already begun taking an interest in the e-commerce site by purchasing shares, and currently owns 5% of the company’s capital.

The acquisition of eBay would open new sales channels for Cohen’s company, thanks to a platform still used today by millions of users, already accustomed to purchasing collectible items and used video games - two sectors in which GameStop is increasingly investing, focusing for example on products such as trading cards and vintage consoles that are highly sought after by collectors.

How GameStop could change as a result

Speaking with the Wall Street Journal, GameStop’s CEO said that the chain’s stores would become pickup points for items purchased on eBay. Cohen also anticipated plans to use the platform to expand into the live e-commerce segment, a live-stream shopping format in which products are presented in real time by a seller and can be purchased directly by connected users: a model already very widespread in Asia and rapidly growing in the West as well.

According to Cohen, the operation could increase eBay’s valuation to as much as $100 billion. GameStop’s CEO also clarified that, if eBay’s board of directors were to reject the offer, his company would turn directly to shareholders by launching what is commonly referred to as a hostile takeover: an acquisition strategy in which one company attempts to take over another by bypassing the will of management, purchasing shares through a public tender offer directed at individual investors. The goal, essentially, is to gather a controlling stake sufficient to impose its own will, effectively overriding the company’s board of directors.