Icahn Seeks eBay-PayPal Split

Jan 23 2014 | 3:30pm ET

Carl Icahn is going to war with online marketplace eBay, which he would like to split in two.

The activist investor has called on eBay to spin off its online payments business, PayPal, eBay said yesterday. Icahn, who has bought a 0.82% stake in the company, has also nominated two board candidates.

John Donahoe, eBay's CEO, said that he had spoken with Icahn last week. But he made clear that he wasn't interested in hiving off PayPal, which eBay acquired in 2002 and which now generates more than 40% of its revenue and which boasts more users than eBay itself.

"We believe that our collection of assets drive more growth and more success together than apart," Donahoe told The Wall Street Journal. "The eBay marketplace accelerates PayPal's success; the eBay marketplace provides data that makes PayPal smarter."

Icahn did not comment on his latest activist campaign. That reticence is somewhat unusual for Icahn, who is frequently seen in the media and who has become an active Twitter user. Icahn also last year launched a web site to promote his efforts.

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