Jan 24 - Investor Carl Icahn says he's ready for a proxy fight with eBay over his proposal to spin off PayPal and name two directors, according to a publish report. Fred Katayama reports.
Hey, PayPal, tell Pop he may have to put up his dukes! Activist investor Carl Icahn told the Wall Street Journal he's ready for a proxy fight with eBay because he expects it will reject his proposal to get two board seats. And he's got more at stake. A source told Reuters he holds close to a two percent share in the e-commerce company, more than twice as much as eBay had disclosed. Old Carl has proposed spinning off the fastest growing part of eBay, the payments service, PayPal. eBay's CEO John Donahoe rejected that proposal, saying the company is better off being intact. Many analysts agree, arguing a spinoff would hurt the parent and compromise prospects of its marketplace business. Baird analyst Colin Sebastian called the spinoff idea "shortsighted." eBay's stock, which rallied sharply after-hours Wednesday on news of Icahn's proposal, fell at the start of trade. Carl Icahn's activism has lifted shares of many of his targets such as Apple. Deutsche Bank analyst Ross Sandler said: "We think the trading range moves up ... on Icahn excitement, but given that private equity likely explored the spin options exhaustively years ago, we view a hostile value-creating event for shareholders as a low probability."