by Cromwell Shubarth – Carl Icahn: PayPal must eat or be eaten to survive in payments. Carl Icahn, the activist shareholder who earlier this year pushed eBay to split off PayPal, called the company’s decision to do so, announced today, a “no brainer” — and said more must be done.
“The payments industry, of which PayPal is an important part, must be consolidated — either through acquisitions made by PayPal or a merger between PayPal and another strong player in the industry,” Icahn said in a statement on his blog .
Icahn and eBay CEO John Donahoe fought for months over the proposal to split off PayPal, which the investor said came “perhaps a little later than they should have, but earlier than we expected.”
Apple Inc.’s plans to get into the payments industry make the split — and additional strategic moves by PayPal — imperative, Icahn said Tuesday.
“In light of the development of strong competition such as the advent of Apple Pay, the sooner these consolidations take place, the better,” he wrote.
As a major shareholder in eBay, Icahn said he plans to discuss the situation with Donahoe. “As I have said in the past and continue to believe, (he) has the interest of enhancing value for all shareholders as his major concern.”
San Jose-based EBay’s stock rose nearly 8 percent at around $57 on Tuesday after news of the pending split-off of PayPal, but was trading short of its 52-week high of $59.20 earlier this year.