Carl Icahn said that he is ready to get into a proxy fight with eBay Inc (NASDAQ:EBAY). Icahn said that he plans to win two seats on the board at eBay and get them to spin off PayPal. He definitely expects eBay to resist the proposal, which is why he is ready to do the proxy fight.
“The company seems to be sort of dug in on the fact they don’t want to do the PayPal spinoff,” said Icahn. “We hope we don’t [have a proxy fight], but if we have to, we will.”
Icahn bought almost a 2% stake in eBay. Icahn said that he believes an independent PayPal could be acquired, which “would make it even better for shareholders.”
“And it’s a shame to have it held back by eBay and that I think is what’s happening,” Icahn added.
eBay acquired PayPal for $1.5 billion in 2002 and it has turned into an entity that generates around $7 billion in annual revenue. Less than 10 years ago, PayPal was generated less than $1 billion. PayPal head David Marcus pushed PayPal into building digital cash registers and mobile payment apps to grow the business. PayPal’s dependence on eBay has been lowering.
eBay CEO John Donahoe disagrees with Icahn completely. “We believe that our collection of assets drive more growth and more success together, than apart,” said Donahoe in an interview this past week.
eBay board members Pierre Omidyar (eBay founder) and Marc Andreessen (investor and Netscape/Opsware/Ning co-founder) wrote on Twitter that eBay and PayPal are at their best when sticking together.
eBay is not the only tech company that Icahn is going after. Icahn now owns $3 billion in Apple stock and wants that company to do a massive share buyback. Apple CEO Tim Cook has been disagreeing with Icahn for months now about that proposal.