GoKawiilGameStop is playing the biggest game of its life: a bid to buy eBay, a company nearly four times its size, according to The Wall Street Journal.
The videogame retailer and meme stock, led by billionaire Chewy co-founder Ryan Cohen, is preparing a takeover offer for the $46 billion online marketplace. GameStop’s market cap sits at just $12 billion, meaning Cohen would need massive debt financing to pull off the deal. The two companies may seem like odd bedfellows, but there is strategic overlap. Both companies have pivoted hard into collectibles — trading cards, sports memorabilia, Pokémon — and eBay’s 135 million active buyers generated $11 billion in revenue last year, up 8% year over year.
Wall Street analysts, however, see real challenges in structuring the transaction. eBay faces fierce competition from Amazon and Walmart, and any deal would require GameStop to take on significant debt. But meme stock king Cohen has never been one to play it safe. “It’s ultimately either going to be genius or totally, totally foolish,” he told The Journal.