Boston, MA 04/10/2014 (wallstreetpr) – After weeks of talks, activist investor Carl Cahn looks to have to an agreement with eBay Inc. (NASDAQ:EBAY) and its PayPal e-commerce business. Part of the agreement will see the online giant adding Icahn pick, David Dorman, into its board of directors as an independent director. This essentially brings to an end a scorched earth campaign that Cahn was running with a view of ensuring eBay was split from its PayPal division.
Icahn signs a Confidential Agreement
Despite coming to an agreement with eBay Inc. (NASDAQ:EBAY), Icahn is optimistic that negotiations will continue which may eventually lead to PayPal being separated from eBay. Part of the billionaire having his eyes and ears in the board through his representative will also see him having regular meetings with eBay CEO John Donahoe to discuss way forward for the online giant.
Icahn as part of the agreement has also signed a confidentiality agreement that will see him being barred from diverging any information made available to Him by the board, to the general public. eBay Inc. (NASDAQ:EBAY) on its part has agreed not to adopt a policy that was intended to prevent the company’s board from speaking with the Billionaire. Icahn on his part stated that he has signed confidentiality agreements in the past with success thus the latest agreement won’t be an issue.
Icahn Allegations
Icahn had accused the company’s management of being asleep while maintaining that the board was conflicted. This was one of the main reason why he was pressing for the inclusion of some of his representatives into the company’s board. Icahn maintained that spinning PayPal would have enabled it get a large strategic investor or a huge public valuation.
Weeks of negotiation with Donahoe looks to have softened Icahn had line position outlining how the company plans to grow especially on its PayPal division. Icahn still maintains that the company could benefit a lot from the separation of PayPal and plans to press his case through, with a closer relationship with the company. Separating eBay Inc. (NASDAQ:EBAY) and PayPal could be the hardest hurdle for Icahn considering they have grown faster together with eBay contributing most of PayPal user acquisition through zero acquisition costs.
