EBay Inc could still be considering a spin-off of their fast-growing payments unit PayPal, and it could happen as soon as next year according to tech news website The Information. The EBay shares jumped nearly 4 percent to $55.48 upon release of the news.
Potential candidates for the position of PayPal chief executive officer were told by EBay about the possible spin-off of the payments unit. The job got vacant when David Marcus left for Facebook back in June.
A PayPal spinoff would mark an about-face for the company, as EBay CEO John Donahoe has resisted demands by activist investor Carl Icahn to seperate the payments service, saying PayPal was integral to eBay’s business and that a split would not make any sense.
“The board will continue to assess all alternatives to create that long-term value and to enhance the growth and competitive positions of both eBay and PayPal. This position has not changed,” eBay spokeswoman Amanda Miller said.
Icahn backed down from his demand back in April, saying that while he supported a PayPal split in the near future, now was not the time. Investors however believe that an independent PayPal can grow by attracting other online retailers in direct competition with eBay.
It is still unclear if eBay actually has decided to spin-off all, or just parts, of PayPal, and what structure it could take on.
Thank you Reuters for providing us with this information.
Images courtesy of eBay.