Early this year, Carl Icahn came out swinging against eBay CEO John Donahoe and its Board, but backtracked on Thursday after the parties came to a settlement and agreed to disagree. Donahoe has passion for the company, Icahn told CNBC, something he realized after spending many hours talking to Donahoe. “I believe John wants what’s good for the company,” Icahn said.
Icahn continues to believe PayPal should be spunoff from eBay, and he told CNBC he personally believes Donahoe thinks the same – “I think the question is, not if, but when.”
Icahn had wanted shareholders to vote on whether eBay should spinoff PayPal, and he wanted to place two of his own employees on the eBay board.
With Thursday’s settlement, Icahn is withdrawing his proposal and board nominations, and eBay is agreeing to appoint business executive David Dorman as an independent director to its Board of Directors. Dorman was Chairman and Chief Executive Officer of AT&T Corp. and later a founding partner of Centerview Capital Technology.
eBay also granted a major concession by allowing its Board of Directors and certain officers of the company to share non-public information with Icahn, who signed a confidentiality agreement covering any such information that is shared with him.
The Wall Street Journal reported that Donahoe said that if Icahn accepts, he will be treated as an insider, with restrictions on when he can trade.
eBay’s announcement of the settlement included a long quote from Icahn who said he intends to continue to press his case that eBay separate PayPal through confidential discussions with the company, and he said Donahoe has agreed to meet with him regularly when he is in New York.
Citing Scott Kessler, an analyst with S&P Capital IQ, the Mercury News said questions will continue to loom about board members Marc Andreessen and Scott Cook, whom Icahn accused of having a conflict of interest. “The situation is not completely over,” Kessler told the newspaper.
eBay made its announcement available on the eBay Investor Relations website. More background about the eBay – Icahn dispute is available on EcommerceBytes.
