Shares of eBay jumped before the opening bell Monday after GameStop, led by Ryan Cohen, pursued a roughly $56 billion takeover of the e-commerce marketplace, casting the bid as a potential platform to compete more directly with Amazon. GameStop said the plan would draw on its store footprint—about 1,600 locations in the U.S.—as part of the combined company’s fulfillment network.

Under the proposal, the retailer said GameStop stores could serve as drop-off and shipping locations for eBay orders. One proposal discussed as part of the plan included live sales broadcasts from GameStop locations featuring eBay products.

GameStop’s offer values eBay at $125 per share in cash and stock, with an equity value of about $55 billion on paper, according to the terms described in the report. GameStop also said it started accumulating eBay shares in February and currently holds a 5% stake in the company.

GameStop said it expects the acquisition to reduce costs at eBay, pointing to the online seller’s spending of $2.4 billion on sales and marketing in fiscal 2025 while adding 1 million net active buyers. GameStop said it would achieve $2 billion in annualized cost cuts within a year of the proposed transaction’s closing.

Cohen, who owns about 9% of GameStop, would serve as CEO of the combined company under the deal structure, with compensation tied only to the performance of the combined business. Cohen became CEO of GameStop in 2023, after the company had become known for meme-stock momentum during the pandemic era, when retail investors helped boost its stock by 1,000% in two weeks in 2021.

In comments in a CNBC interview Monday, Cohen said, “EBay has the second largest commerce franchise and there’s a big opportunity to do something much larger.” The company’s proposal was framed as a vehicle for scaling eBay’s commerce franchise, with GameStop positioned to bring a retail operations base alongside an online marketplace.

eBay confirmed the “huge bid” on Monday and said it had not had talks with GameStop or received any outreach from the company before it received the proposal. The report said eBay’s board, along with its financial and legal advisers, will review the offer and determine a course of action.

In the premarket trading reaction, eBay shares rose more than 7%, while GameStop’s stock declined nearly 3%.