Raider Carl Icahn tells eBay to spin-off its PayPal business

 

New York, London

'Activist investor' Carl Icahn today turned his sights on eBay and Apple, proposing that eBay spins off its PayPal business and that Apple should buy back even more of its stock

As it announced its quarterly earnings, eBay said corporate raider Icahn had gained control of almost 1 per cent of the company’s stock and nominated two of his employees to eBay’s board. eBay’s stock price rose as much as 10 per cent in after-hours trading.

eBay said in a statement its board had already “explored in depth a spinoff or separation of PayPal,” but concluded “the company and its shareholders are best served by the current strategic direction of the company and does not believe that breaking up the company is the best way to maximize shareholder value.”

eBay added: “Payment is part of commerce, and as part of eBay, PayPal drives commerce innovation in payments at global scale, creating value for consumers, merchants and shareholders.”

eBay’s revenue rose 13.5 percent to $4.53 billion for the quarter ended December 31, just below some analysts’ estimates.

“We think that it all fits in with the philosophy that we have that shareholders should have a lot more to say on big picture items on companies...” said Icahn on Bloomberg Television.

“We have done a lot of work on eBay... and we believe without question it's a no-brainer that PayPal should be spun off... there's no reason they should be together at this point.

“In fact I think it would be helped by a management team that is separate...”

Earlier, Icahn heaped more pressure on Apple to return more cash to investors, claiming the technology giant is “doing great disservice to shareholders” by not buying back more stock.

The billionaire took to Twitter to criticise Apple’s board, calling for the iPhone maker to “markedly” increase its planned shares repurchase scheme, and saying he would send management an “in-depth letter” stating his case.

Mr Icahn has been calling for an increase to the buyback programme since he disclosed a stake in the company last August, initially pushing for as much as $150bn to be returned to shareholders.

The veteran corporate raider also revealed that his investment vehicle, Icahn Enterprises, had purchased a further $500m of Apple shares, taking its stake to more than $3bn. The holding is Mr Icahn’s single biggest investment, although it represents only 0.6 per cent of Apple. The 77-year-old said the firm’s stock was a “no brainer” at its current price.

Apple is planning to spend $60bn buying back shares over three years but Mr Icahn wants it to return $50bn in the next year. The iPad and Mac maker is thought to be sitting on a $150bn cash pile.

Mr Icahn’s tweets added to pressure on the Apple chief executive, Tim Cook, to increase the buyback plan. Mr Cook said in September that any changes to the programme would be announced “in the first part of the new calendar year”. An increase could come as soon as Monday when the company reports its results for the last quarter.

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk