In a letter sent to eBay shareholders today, Carl Icahn calls eBay’s corporate governance “dysfunctional,” particularly when it came to Skype’s $8.5 billion sale to Microsoft in 2011.
It is the latest move in the shareholder activist’s campaign to force eBay to spin-off PayPal into a separately traded company. Icahn says he plans to come up with a detailed business case for the separation in the coming weeks, and is asking shareholders to vote for a new slate of directors.
“We believe corporate governance at eBay is dysfunctional,” Icahn writes. “Let’s end this charade.”
In today’s list of complaints, Icahn points to eBay’s sale of Skype to Microsoft as cause for concern. He said eighteen months before the $8.5 billion sale to Microsoft, eBay sold a controlling stake in Skype to Silver Lake for only $1.9 billion. The reason why that’s fishy is because Marc Andreessen was a director at eBay and Silver Lake owner at the time of the two deals.
“The phenomenal payday for Mr. Andreessen and Silver Lake raises serious red flags. It is therefore particularly galling that [eBay's] management continues to hold this transaction out as an example of the board acting ‘objectively’,” he said.
EBay responded to Icahn’s claims in aletter, saying that they are not “factually accurate,” and in particular, the claims against Andreessen are “blatantly false.” When divesting Skype, eBay engaged in a competitive process with multiple bidders; and when eBay kept a 30 percent stake in Skype following the sale to Silver Lake, Andreessen “recused himself from all deliberations on the transaction.”
EBay is refusing to be bullied by the tycoon, known for his hard-charging campaigns against public companies: “Carl Icahn doesn’t let the truth get in the way of a good story. And while his letters and media interviews may be entertaining, they are not factually accurate.”