GameStop Corp. has floated a $56 billion unsolicited takeover bid for eBay Inc., offering $125 per share in cash and stock—about a 20% premium to Friday’s close. Ryan Cohen, the retailer’s billionaire CEO, unveiled the proposal Monday, sparking curiosity but little enthusiasm from merger arbitrageurs.

Despite the headline‑grabbing premium, the offer lags behind eBay’s current trading level—roughly $107—creating an $18 spread that has widened since the announcement. The lack of definitive terms, a daunting $20 billion debt pledge from TD Bank, and the need to issue over a billion new shares dilute GameStop’s equity.

Arbitrageurs cite three red flags: an opaque deal structure, a massive financing gap, and a dilution level that could exceed GameStop’s authorized shares. Analysts suggest Cohen may use the bid to lift GameStop’s stock price rather than pursue a traditional merger, a tactic that has drawn skepticism from institutional investors.

Retail investors have surged on both sides, with GameStop recording its fifth‑biggest net buying day of the year after the announcement. Until eBay responds or the terms crystallize, market participants remain cautious, viewing the proposal as a speculative play rather than a viable merger opportunity.