Carl Icahn, the activist investor, is ramping up his campaign for two board seats at eBay and the spinoff of its PayPal unit.
In an open letter to eBay shareholders published Monday morning, Icahn called out eBay directors Marc Andreessen and Scott Cook for alleged conflicts of interests and questioned how CEO John Donahoe could be the “right person to make the strategic decisions necessary to achieve long-term value creation when he relies on his ‘world-class board of directors’ with competing interests that challenge their fiduciary responsibility to eBay stockholders?”
Last month, Icahn revealed a stake in eBay that has grown to more than two percent, while also calling for eBay to spin PayPal off into a separate company. EBay has rejected the spinoff request. Now Icahn’s campaign has gotten personal.
EBay responded this morning, saying Icahn “has cherry-picked old news clips and anecdotes out of context to attack the integrity of two of the most respected, accomplished and value-driven technology leaders in Silicon Valley.”
Icahn’s attacks on Andreessen center around stakes he took in two former subsidiaries: Skype and Kynetic, which now owns the e-commerce companies Fanatics and ShopRunner. Icahn also calls out Andreessen, the co-founder of venture capital firm Andreessen Horowitz, for investing in Dwolla and Jumio, payments companies that some could argue are competitive with PayPal.
When it comes to Cook, the founder and a board member at Intuit, Icahn brings up Intuit’s credit card reader business that Icahn alleges competes with a similar one at PayPal. The truth, though, is that they target different types of business customers. There’s more, but I’m not going to summarize every point here; you can read the letter in full for all the details.
And here’s eBay’s letter, which includes an answer for each of Icahn’s accusations.