Ryan Cohen pulls his GameStop pay plan as the eBay bid becomes an incentive test

Why it matters

Cohen removed the most visible personal-incentive conflict from GameStop's eBay campaign, but the deal still turns on financing, leverage, and whether eBay holders believe GameStop can operate a much larger marketplace.

Ryan Cohen (@ryancohen) asked GameStop to pull his proposed CEO Performance Award from the company's proxy statement on June 23, a governance retreat that removes an easy line of attack as eBay, the San Jose online marketplace, rebuffs his unsolicited takeover bid.

Business Insider reported Wednesday that the withdrawn package could have been worth more than $35 billion if Cohen hit the full set of market-cap and profit hurdles. GameStop said in its own release that its board granted Cohen's request to amend the proxy and remove the award because he wants leadership focused on operating performance and the proposed acquisition of eBay.

That is the clean public version. The more important version is that Cohen, the Chewy cofounder who built an online pet retailer around service and fulfillment before PetSmart bought it, is trying to make the eBay fight about industrial logic rather than personal upside. eBay rejected GameStop's non-binding cash-and-stock proposal in May; the company cited concerns about credibility, financing, value, and governance in its response letter.

The pay plan became a flashpoint

GameStop's withdrawn plan would have granted Cohen up to 171.5 million share options tied to a $100 billion market cap and $10 billion in adjusted profits, per Business Insider. Shareholders had been expected to vote on the package ahead of GameStop's July 7 annual meeting.

On paper, that was an owner-operator contract: no full payout unless the company got much larger and more profitable. In the middle of an attempted acquisition of a company far larger than GameStop, it became something else: a question about whether Cohen's incentives pushed him toward a dilutive, transformational deal that could move the headline metrics embedded in his compensation plan.

The objection was not theoretical. Business Insider reported that Michael Burry, the investor known for his role in "The Big Short," sold his GameStop stake in early May because he was skeptical of the eBay deal and suggested Cohen's package could create a motive to pursue a heavily dilutive transaction. GameStop, according to the same report, said Cohen would not have received a windfall purely from buying eBay because the performance hurdles would be adjusted to reflect a stock-based acquisition.

The withdrawal does not remove every incentive question. Cohen still owns a large GameStop stake, and any deal that uses GameStop shares would still ask eBay holders to underwrite his operating thesis. But it does remove the simplest argument against him: that a successful acquisition could put him on a path to a massive personal option payout approved before the eBay fight began.

Cohen's eBay bid is an operator bet, not just an M&A swing

GameStop's May proposal was a non-binding cash-and-stock bid for eBay. Business Insider said eBay rejected the offer in May despite Cohen continuing to press for the transaction.

Cohen's strategic pitch is the same one that has followed him from Chewy to GameStop: make the operation leaner, use physical infrastructure as an advantage rather than a burden, and turn customer trust into marketplace liquidity. Business Insider said he highlighted the opportunity to cut eBay's costs, use GameStop's roughly 1,600 U.S. stores for live-commerce fulfillment and creator studios, and build a marketplace for digital items in video games.

Cohen reiterated on the All-In podcast that the deal sits within his "circle of competence" and said he would contribute $500 million personally, according to Business Insider.

That personal check is not enough by itself to finance a transaction for a company Business Insider said had a market value of about $48 billion, more than five times GameStop's. It is a signal. Cohen is trying to show eBay shareholders that his bid is not only a GameStop balance-sheet maneuver or a meme-stock aftershock, but a founder-led operating campaign with his own capital attached.

eBay has already named the risks

eBay rejected GameStop's proposal in May, saying its board had reviewed the offer with advisers. The response framed the proposal as a credibility, financing, value, and governance problem, not merely a price negotiation.

That list matters because Cohen's withdrawal addresses only one part of it. eBay still has a scale argument. Wikipedia's eBay entry describes the company as operating in 190 markets worldwide and summarizes its 2023 transaction volume at $73 billion. GameStop is pitching cost discipline and stores as strategic assets, but it would be taking on a global marketplace with its own seller base, payments systems, search dynamics, trust machinery, and regulatory footprint.

The leadership question is also unresolved, even without the withdrawn award. From GameStop's side, Cohen is the asset investors are being asked to underwrite. From eBay's side, that same founder-centered pitch can be turned into a control-risk argument: a contested transaction would hand a much larger marketplace to the buyer's operating thesis.

The July 7 clock now matters

GameStop's annual meeting is scheduled for July 7. Before the withdrawal, shareholders were set to vote on the CEO Performance Award as part of the proxy process. Now Cohen has removed a vote that had become entangled with the eBay campaign.

GameStop said it would provide fresh materials this week on the proposed eBay acquisition, including its strategic rationale and how it plans to run the combined company, according to Business Insider. Those materials have to do more than repackage the May offer. They have to answer the questions eBay put on the table: why GameStop is the right buyer, how the financing works, how much leverage the combined company can carry, and why eBay shareholders should accept GameStop stock as part of the consideration.

Cohen's move is founder logic applied to public-company M&A: if the boardroom fight is becoming about whether the founder is aligned, remove the pay package and force the debate back to the plan. The risk is that alignment was never the only objection. eBay has already said the proposal fails on credibility, value, financing, and governance. Pulling the award helps Cohen's argument. It does not make the acquisition executable.