eBay Founder Pierre Omidyar defends keeping PayPal

Posted Feb 27, 2014

eBay founder Pierre Omidyar announced on Thursday that Carl Icahn’s claims that the company is not operating in the interest of shareholders are false. Icahn wrote three letters to eBay shareholders that urges the splitting off of PayPal, which is the fastest growing division at eBay and accounts for around 40% of the company’s revenues.

Icahn targeted two of eBay’s directors and CEO John Donahoe. Icahn said that responses to his letters from “eBay’s public relations machines” aren’t sticking to the facts.

“After diligent consideration, we believe that PayPal and eBay are better together. In the future, if we determine that?s no longer true, we will act accordingly and in the best interests of shareholders and the company,” said Omidyar. “Mr. Icahn?s attacks are false and misleading.”

eBay acquired PayPal for $1.3 billion in 2002. PayPal went from an online payments service to a brick-and-mortar store service.

Icahn took a stake in eBay that was at less than 1% in January. He is seeking a non-binding shareholder resolution to spin off PayPal. eBay said that they considered a split from PayPal, but decided it was not the best move for shareholders. eBay said that they would review Icahn’s nominees for the board though.

[Source: eBay]