eBay (NASDAQ: EBAY) and Carl Icahn Come to Agreement Regarding the Future of PayPal - Market News | Financial Buzz

eBay (NASDAQ: EBAY) and Carl Icahn Come to Agreement Regarding the Future of PayPal

PayPal, AT&T, CVS, eBayActivist eBay (NASDAQ: EBAY) shareholder, Carl Icahn, had long been at odds with eBay CEO John Donahoe over the future of eBay’s subsidiary company, PayPal. The online payment method platform, Icahn asserted, was having its growth stunted under its parent company and would be better served as a separate endeavor altogether. Icahn, who owns the equivalent of $15 billion dollars worth of eBay stock, was looking to take advantage of the red-hot market for tech IPOs, by taking PayPal public. In lieu of the recent downturn in the technology sector, Icahn has had his wings clipped, which may have brought him back to the bargaining table. Icahn stated his intention to avoid going to “war” with eBay board, but his choice of words suggests the acrimonious relationship that still exists between the parties.

Former CEO of AT&T (NYSE: T) Added to eBay Board

To settle the dispute, Icahn withdrew his strong endorsements of two potential eBay board members and accepted the nomination of David Dorman, who formerly served as CEO of AT&T and also holds a top position at CVS Corporation (NYSE: CVS). The concession on the part of Icahn may be due in large part to the volatility of his company’s, Icahn Enterprises LP (NASDAQ: IEP) stock in recent weeks. A majority of the sway that Icahn held with eBay was based on the success of his own holding firm, but the stock has vacillated wildly between the $115 and $100 dollar per share range. The new board member has a fan in Icahn, but analysts believe that the enigmatic activist investor may reopen the feud in the future if eBay underperforms.

Icahn States Optimism for eBay ‘s Future to CNBC

In a complete 180 from his prior assertions that eBay was a terribly run company, Icahn stated, in an interview with CNBC, that he could reasonably see eBay’s share prices reach the $150 range. eBay shares currently trade around the $53 dollar mark, at the close of Fridays trading, but Icahn made his belief known that eBay could become “the next Netflix”. For his predictions to be true, eBay has a long way to go as Netflix (NASDAQ: NFLX), even in a down stretch, currently trades above the $327 range. Icahn may claim that he believes in eBay’s future under current management, but his rationale for settling the feud is anything but based on his true feelings for the company’s future.