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Icahn accuses eBay board of losing $4bn

Icahn gets no satisfaction
Mon Mar 10 2014, 16:01
Carl Icahn

BUSINESS TYCOON Carl Icahn has accused eBay's CEO of costing investors $4bn in potential profits by bungling the sale of Skype and making poor business decisions.

Icahn has posted several open letters to the eBay board of directors recently, which have included demands for his own people on the Board of Directors and an immediate salee of payment arm, Paypal which he believes will be more valuable as a separate entity.

Chief Executive of Ebay John Donahoe, is accused of "inexcusible incompetence" and suggests that Paypal could "wither" if it remains a part of Ebay. All Icahn's statements have been rejected by Ebay which believes that Paypal should remain part of the company.

Mr Icahn, whose aggressive business style has amassed a fortune of $20bn over the past fifty years through a strategy of targeting stock purchases of key companies including Dell and Apple has recently set his sights on eBay, in which he recently acquired a two percent stake.

Since doing so, Mr Icahn has been using the open letters as a platform to lobby eBay to expand its board of directors to include two of his representatives. The eBay board has already rejected Icahn's nominees, saying that neither of them "has relevant experience or expertise".

The board also rejected the aggressive accusations by Icahn that CEO John Donahoe and his fellow directors bungled the sale of Skype. Icahn believes that Skype would have netted the company billions more had the firm held on to it for another 18 months or so to force Microsoft, which had made no secret of its desire to own the VoIP and chat service, to increase its bid.

Ebay told Reuters, "In pursuit of his own profit motives, Carl Icahn has made another unsubstantiated attack on John".

Although Icahn's allegations have yet to make an impact on eBay's board of directors, his letter slightly affected early morning trading, with eBay's share price dropping 0.9 percent. µ

 

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