GameStop proposes takeover of eBay, which has four times its market cap... CEO says it could grow it to Amazon's scale

[The Financial News] U.S. video game retailer GameStop has proposed a friendly takeover of eBay, the giant e-commerce company, in a deal worth $56 billion, or about 83 trillion won.
On the 3rd local time, The Wall Street Journal (WSJ) reported that GameStop CEO Ryan Cohen revealed in an interview that the company had already secured about a 5% stake in eBay and had made a takeover offer that would pay $125 per share in cash and stock.
The $125 per share offer represents a roughly 20% control premium to eBay's closing price on the 1st. Cohen expressed strong confidence in the rationale behind the deal.
He said, "eBay deserves to be valued far higher than it is now, and it will be," adding, "I have a plan to transform eBay into a company worth hundreds of billions of dollars."
Cohen was optimistic that combining GameStop and eBay would create a major opportunity to cut costs and improve performance.
He also suggested that if eBay's board is uncooperative with the proposal, he would take the offer directly to shareholders and push ahead.
GameStop has secured a commitment for about $20 billion in acquisition financing from Toronto-Dominion Bank (TD) and is considering raising additional funds from outside investors, including Middle Eastern sovereign wealth funds.
The takeover attempt is being viewed as an unusual event in the market. That is because GameStop, with a market capitalization of about $12 billion, has moved to acquire eBay, which is roughly four times larger with a market value of about $46 billion.
The Journal said the bid could upend conventional merger and acquisition practices, and that massive debt and large-scale new share issuance would be unavoidable.

jjyoon@fnnews.com Yoon Jae-jun Reporter