Feeds

Thanks for suggesting eBay should flog PayPal. It's not happening, CEO tells Carl Icahn

Tat bazaar boss rejects activist investor's proposal

Providing a secure and efficient Helpdesk

eBay has rejected a call from activist investor Carl Icahn to spin off its PayPal division into a separate company.

John Donahoe, chief exec of the online marketplace, said that he had spoken with Icahn but the board and management believed that eBay and PayPal would do better if they stayed together.

"The synergies are clear," he said in a letter to employees. "PayPal has succeeded because it is a part of eBay, not in spite of it. eBay accelerates PayPal’s success, providing tens of millions of customers who then help PayPal grow off-eBay.

Donahue pointed out that it's not the first time the idea of spinning off the online payments firm had come up, and said the board does keep an eye on that option. But he told employees not to let Icahn's proposals "become a distraction".

"The best way we can create value is by executing our plans, delivering growth and serving our customers," he said.

"The closed loop global transaction data provided by eBay makes PayPal smarter,” he added, “enhancing its world-class risk capabilities. And eBay funds PayPal’s growth. This enables PayPal to invest aggressively in mobile, credit and acquisitions such as Braintree."

Analysts have suggested before that building a wall between eBay and PayPal would help other etailers to see the payments service as an option for their own shops. But eBay is likely to be reluctant to let the once-independent firm go, given that it contributes around 40 per cent of the company's overall revenue.

Icahn's proposal comes along with two nominations to eBay's board, who haven't been named yet. The company said that then nominees would be passed on to the relevant committee for consideration, but also hinted that it was quite happy with the current board. Icahn currently holds a 0.82 per cent stake in eBay.

"We would note that eBay has a world-class board of directors with directors who have significant experience in technology and financial services," the board said in a statement.

Despite Icahn's agitation, the company's full year results, released yesterday, show that both payments and marketplaces are going well for eBay. The online bazaar saw net revenue grow across its business by 14 per cent to $16bn in 2013 compared to the year before, with Payments rising 19 per cent and Marketplaces gaining 12 per cent.

Net income for the year was $2.8bn, a lift of nine per cent from 2012. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Huawei ditches new Windows Phone mobe plans, blames poor sales
Giganto mobe firm slams door shut on Microsoft. OH DEAR
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.