Seeking Alpha

Report: eBay thinking of spinning off PayPal

  • Though it has rejected Carl Icahn's call for a PayPal spinoff, eBay (EBAY +3%) has been "telling potential recruits for the position of PayPal CEO that it’s considering spinning off the payments business as soon as next year," The Information reports.
  • eBay and Icahn engaged in a war of words earlier this year, with the former insisting it needed to hold onto PayPal due to various synergies with Marketplaces, and the latter arguing eBay's board was compromised by conflicts of interest.
  • eBay has spiked in response to the report. PayPal, which saw respected division chief David Marcus leave in June for Facebook, almost certainly accounts for over half the company's $68B market cap.
Comments (17)
  • stk28097
    , contributor
    Comments (58) | Send Message
     
    Thanks Carl!
    21 Aug 2014, 10:27 AM Reply Like
  • Dr Joseph Haluska
    , contributor
    Comments (430) | Send Message
     
    I'll second that!! Thank you Mr. Icahn for once again making things happen.
    And I'll buy PayPal as soon as it happens.
    21 Aug 2014, 10:39 AM Reply Like
  • chammond63
    , contributor
    Comments (68) | Send Message
     
    Hail Carl
    21 Aug 2014, 10:36 AM Reply Like
  • Quantease
    , contributor
    Comments (73) | Send Message
     
    Get in this will create momentum
    21 Aug 2014, 10:41 AM Reply Like
  • SoldHigh
    , contributor
    Comments (1013) | Send Message
     
    Especially in this frothy, PayPal spinoff is good idea.
    21 Aug 2014, 11:06 AM Reply Like
  • Stephen Aniston
    , contributor
    Comments (2706) | Send Message
     
    Of course, let's heap all kind of scorn on Carl Icahn and then do exactly as he prescribed. Look, activist investors engage in creative financial thinking that far surpasses the financial capabilities of our tech geniuses. What a surprise!

     

    The funny thing is, for the life of them, the tech guys can't figure out how guys like Carl Icahn became rich.
    21 Aug 2014, 11:08 AM Reply Like
  • Tales From The Future
    , contributor
    Comments (5216) | Send Message
     
    Finally. Why didn't they do this years ago?

     

    PP could have added major clients like AMZN without being tied to a competitor.
    21 Aug 2014, 11:14 AM Reply Like
  • Seeker137
    , contributor
    Comments (336) | Send Message
     
    Note the strategic timing of the "release" of this information to bolster eBay stock.
    21 Aug 2014, 11:23 AM Reply Like
  • VelcroWonderCat
    , contributor
    Comments (30) | Send Message
     
    Why the sudden retreat from the "better together" propaganda espoused by Ebay's underwhelming management team? I thought they reached an understanding with Mr. Ichan on this issue to bring the war of words a few months ago to an end.

     

    I'll believe this when I see it.
    21 Aug 2014, 12:01 PM Reply Like
  • Overanalytical
    , contributor
    Comments (816) | Send Message
     
    Does musk still have any stake in Paypal?
    21 Aug 2014, 12:16 PM Reply Like
  • LetEmKnow
    , contributor
    Comments (32) | Send Message
     
    Does anybody have any thoughts on a SOP valuation for eBay? I'd think buying before the announcement of a spin-off is ideal because PayPal will be a very 'in-demand' spin-off. I'd think going long the parent company prior to the announcement would be the way to go in this situation.
    21 Aug 2014, 12:34 PM Reply Like
  • Seeker137
    , contributor
    Comments (336) | Send Message
     
    @LetEmKnow this could have been a very clever manipulation by eBay to get investors thinking about how much PayPal is actually worth. Make them think it's going to be spun off so they'll think about its enormous value, then announce that you're not going to spin it off so they'll see ebay's stock value as being enhanced by keeping PayPal. All the while of course, drawing positive media attention to try to distract away from whatever it is that eBay doesn't want the public focusing their attention on at the moment in regards to what's really going on at eBay...
    21 Aug 2014, 01:33 PM Reply Like
  • LetEmKnow
    , contributor
    Comments (32) | Send Message
     
    I guess we see things differently. I see a rising stock price on spin-off news as saying it would enhance the value of eBay to remove the multi-segment discount. I haven't done any back-of-envelope math, but it seems those that have would argue it's worth more separated. If eBay had leaked the rumor and the stock price went down, then I think they could make the argument that the market prefers they keep the two companies joint.
    21 Aug 2014, 01:42 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (21433) | Send Message
     
    It has been denied.
    21 Aug 2014, 12:46 PM Reply Like
  • Bobbert333
    , contributor
    Comments (142) | Send Message
     
    Watch they are going to spin off paypal, then Amazon will buy it :)
    21 Aug 2014, 02:32 PM Reply Like
  • Dr Joseph Haluska
    , contributor
    Comments (430) | Send Message
     
    Google and Apple will fight over it, IMO
    21 Aug 2014, 02:49 PM Reply Like
  • philli66
    , contributor
    Comments (31) | Send Message
     
    Finally!!!!!!!!!!!!
    21 Aug 2014, 03:59 PM Reply Like
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