r/RoaringKittyStocks

Here's the straightforward math:

Assumptions:

• GME pre-news price: ~$24/share
• Stock portion of deal: 50% of $55.5B = $27.75 billion in new GME shares
• New shares needed: $27.75B ÷ $24 = ~1.16 billion new shares
• Current shares outstanding: ~448 million

Result:

• Total shares after deal: ~1.6 billion
• Existing holders go from 100% → ~28% of the company
• That's roughly 72% dilution to current GME shareholders

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One important nuance: if GME's stock price rises significantly because of the deal excitement, fewer new shares need to be issued. For example:

GME Price Used	New Shares Issued	Dilution to Existing Holders
$24	~1.16B	~72%
$35	~793M	~64%
$50	~555M	~55%
$75	~370M	~45%

So ironically, the higher GME runs on this news, the less dilutive the deal becomes. But even in the most optimistic scenario, existing GME holders are looking at getting cut roughly in half.

The bet Cohen is making is that a combined GME+eBay entity is worth far more than the sum of parts — enough to overcome the dilution. That's a tough case to make to skeptical investors.

Wearing his fucking leather jacket and avoiding the real questions. GME WILL TURN YOUR SHARES TO SHIT. SShareholders will fund the ebay purchase and lose everything. Never forget bad bath and beyond dirty deal.

So GME is down over a dollar today because sentiment is negative.

Doubts about the eBay acquisition financing.

Multiple outlets report that GameStop’s bid relies on “highly confident” letters rather than committed capital, which is making investors nervous.

Cohen's charity offer for ebay is having a negative spin on GME stock. But why?

Does Cohen really care about the shareholders? He says he's aligned with the shareholders but the numbers don't reflect that. Shareholders continue to see the shares being diluted. Is dilution just a strategy to benefit Cohen?

In January 2026, the board granted Cohen a performance-based stock option award covering 171.5 million shares at $20.66 per share, with full vesting requiring a $100 billion market capitalization and $10 billion in cumulative EBITDA.

So Cohen's real bet is if GME + eBay becomes a $100B+ company, his options alone would be worth tens of billions and far more than protecting his current 9.3% stake in a $11B company.

The bottom line:

Cohen is essentially trading a large slice of a small pie for a smaller slice of what he hopes will be a much, much bigger pie. He's not thinking about dilution — he's thinking about the destination market cap.

Follow the money.

GME offered $125/share in "cash and stock" That means each eBay shareholder would receive a combination of:

Some cash per share

Some GME shares per share (at an exchange ratio set at deal close)

The exact split hasn't been fully detailed yet, but if we assume roughly 50/50:

~$62.50 in cash

~$62.50 worth of GME stock (converted at whatever GME's price is at closing)

eBay shareholders do NOT keep their EBAY shares. Those get cancelled/retired.

They either: Take the cash portion and walk away.

Hold the GME shares they received and become GME shareholders in the combined company.

Sell the GME shares immediately after receiving them (many institutional holders do this, which adds selling pressure on GME post-close).

The risk for eBay holders

The stock portion is tricky — if GME's share price drops between the deal announcement and closing (which can take 6–12 months), the value of what eBay holders receive drops with it. That's why eBay's stock is trading well below the $125 offer price right now — the market is pricing in deal risk and uncertainty about GME's ability to close.

Cash portions are locked in. The stock portion floats.

"Regarding GME: Hypothetical my solution may be, yet it is remarkable how a scalpel can be used differently than a meat cleaver. The reason I put so much thought into my structure.was not to make ir complicated. I wanted to avoid dilution and recourse debt, and I felt Ryan would want to maximize his ownership of the combined entity. I also was interested in preserving NOLs. All while achieving similar post deal EBITDA to more debt heavy, dilutive approaches.

As well, I took the challenge as breaking new ground and revolutionizing capital markets strategy at face value.

Perhaps I just thought it was obvious that maximizing function while minimizing blood loss ,and recovery time would be the goal.

What is happening instead makes perfect sense. Ryan is following the incentives before him. His compensation package by focusing on incentivizes on market cap and EBITDA obvious incentivized 10x dilution of shareholders while guaranteeing that in that event, he would mostly be kept whole.

While most GME bulls are taking this as that 100B market cap is a 10x type of incentive for shareholders, Ryan is proving the opposite. The whole structure, if done twice, gets him a stake 10x more valuable by diluting shareholders 10x. His proposal is almost halfway. By done twice, I mean he would do eBay then do a similar trick again.

Ryan is promising huge cost cuts and massive jumps in profitability. This also makes sense. It is the Wall Street playbook. If eBay doubles its EBIT margin of 20% to 40%z, it would be on par with Meta and 50% better than Alphabet.

But it will would not get eBay to a spot where it could pay off the debt in a few years, as Ryan is promising.

The debt level needed to get this deal done would likely take 7-10 years to pay down and even then only if all capital was directed to such a task.

My solution would have broken new ground and would have required a CEO in full control of its board to ignore the incentives in his new pay package. Makes perfect sense that did not happen.

It almost never happens. Which is why Warren Buffett is so respected."

Ryan Cohen (GameStop CEO) is unlikely to succeed in acquiring eBay with the current $56 billion unsolicited bid (around $125/share, ~20% premium), primarily due to massive financing gaps, valuation mismatch, execution risks, and eBay's probable rejection.

1. Financing Doesn't Add Up (The Core Math Problem)

GameStop ($11-12B market cap) is trying to buy a much larger company ($46B eBay valuation). The proposal is roughly half cash, half Gamestop.

GameStop has ~$9B+ in cash/liquid assets. "Highly confident" financing letter from TD Securities for up to ~$20B debt.

Even adding GameStop's market cap, there's a ~$16-20B shortfall that would require heavy dilution via issuing new GME shares.

Cohen's CNBC interview was widely seen as combative and evasive—he repeatedly said "the details are on our website," claimed not to understand the question, and leaned on the ability to issue stock without addressing the gap clearly. This eroded credibility and contributed to GME shares dropping ~10% while eBay rose only modestly (well below the offer price).

Heavy dilution would punish existing GME shareholders, making the deal unattractive to them and complicating approval.

2. Size and Strategic Mismatch

eBay is several times larger than GameStop in market value, revenue, and operations. GameStop has been shifting toward collectibles (e.g., Pokémon/TCG) and has physical stores, while eBay is a mature online marketplace. Synergies (e.g., using GME stores for fulfillment/authentication, $2B cost cuts) sound plausible on paper but face huge integration challenges: different business models, cultures, and tech stacks.

Analysts and markets are skeptical—eBay shares didn't surge to the offer price, signaling doubt about completion or value creation. Turning the combo into an "Amazon competitor" is a bold vision but unproven at this scale for a meme-stock-linked retailer.

3. Hostile/Unsolicited Nature and eBay's Response

No prior talks with eBay management. eBay's board will review it (standard process), but they have "perverse incentives" (per Cohen) to resist—stronger bargaining power, potential for a higher bid from others, or simply rejecting a smaller, riskier buyer. Hostile takeovers of this size are rare and often fail without overwhelming support.

eBay shareholders would need to accept a large portion of volatile GME stock (tied to meme dynamics and dilution) in exchange for their shares. Many would likely prefer cash or a premium from a more stable acquirer.

4. Broader Risks and Precedent

Regulatory/Approval Hurdles: Antitrust scrutiny for a combined e-commerce player, plus shareholder votes on both sides.

Execution Track Record: Cohen succeeded with Chewy and stabilized GameStop's cash position, but this is orders of magnitude larger and more complex.

Market Sentiment: Seen by many as overreach or even a troll/4D chess move tied to GME short dynamics, but skepticism dominates outside dedicated retail investor circles.

Bottom line: The bid highlights ambition (and possibly leverages GME's cash pile and stores creatively), but the numbers, interview optics, and power imbalance strongly suggest it fails or gets heavily renegotiated/diluted into something else. Cohen has surprised people before, but the fundamentals here point to low odds of a clean win. This is developing news—watch for eBay's formal response and any revised terms.

Gamestop hasn't even announced any substantial details about ebay and the market is not a big fan of the news. It already dropped 4 bucks a share in 2 days.

Whats next?

I sat at my kitchen table, late one evening in early 2021, staring at my laptop screen. The house was quiet except for the hum of the refrigerator and the occasional car passing on the dark suburban street. My fingers hovered over the keyboard. I had been scrolling through Reddit’s r/WallStreetBets for weeks, watching the chaos unfold around GameStop—GME. At first, it seemed like a joke: a bunch of internet degens piling into a dying brick-and-mortar video game retailer. But the more I read, the more the story hooked me. Short sellers had bet billions that GameStop would go bankrupt. The stock was trading under $20, heavily shorted, and a new generation of retail traders smelled blood in the water. “Fuck it,” I muttered to myself. I opened my brokerage account, transferred a chunk of my savings—money I’d been setting aside for a new car or maybe a vacation—and bought my first shares of GME at around $40. It felt reckless. It felt alive. Over the next few days, I kept buying on the dips. $60, $80, $100. Each time the price ran, my heart pounded. When it hit $150, then $300, and eventually rocketed toward $400 in those wild January days, I barely slept. My phone notifications exploded. Friends texted me memes. My wife raised an eyebrow but didn’t say much—she knew I had always been the guy who liked a calculated gamble. Then came the frenzy: trading halts, Reddit going nuclear, hedge funds bleeding, and the whole world watching. I didn’t sell. Not at $400, not when it crashed back down, not during the long, grinding months that followed. Years passed. Now it’s 2026. I still hold my GME shares. The position has been through multiple squeezes, dilutions, Ryan Cohen’s moves, console cycles, and endless speculation about transformation into something bigger—e-commerce, blockchain, whatever the next narrative became. Some days the stock trades like a meme relic. Other days it spikes on random volume and sends the community into fresh euphoria. I check the price every morning with my coffee. Some mornings it’s a slow bleed that tests my patience. Others, a sudden green candle makes my pulse quicken with that old familiar rush. I’m no longer checking daily charts obsessively like in 2021, but the bag is still there—my “diamond hands” turned into calloused, stubborn hands. I sit on the back porch now, same laptop, scrolling through the latest GME forum posts and X threads. The community is smaller but more hardened. The shorts never fully covered, the theories never died. Every earnings call, every cryptic tweet from the chairman, every unusual options flow brings a flicker of hope. I lean back in my chair, take a sip of beer, and smile to myself. I’m still waiting on the big pay. Not for the Lambo or the yacht—not really. At this point, it’s become something else: a story I tell myself about conviction, about not folding when the world called it stupid, about being part of a weird, beautiful, chaotic moment in financial history that no one can ever fully explain. One day, I tell myself, the rocket will finally light. The mother of all short squeezes. The infinity pool. The number that makes the early buyers legends. Until then, I hold. I bought GME back when it was still just a punchline to most people, and I’m still here—patient, stubborn, and quietly convinced that the big pay is coming. The wait continues. In my home, under quiet suburban skies, a man and his packed bags keep the faith. Moon soon, brother. 🚀