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EBay initiates operating review

Mar '19
Pic: Ebay
Pic: Ebay
EBay has taken several steps such as an operating review and the commencement of a strategic review of the company's portfolio of assets, including StubHub and eBay Classifieds Group, to enhance performance and value creation. The company is working with Elliott Management, Starboard Value, and other significant shareholders on these initiatives.

The company has also added two new independent directors to the board.

In a process initiated by eBay's board of directors and management late in 2018, these initiatives build on the capital allocation measures announced by eBay in January, including the introduction of a quarterly dividend and the return of $7 billion of capital to shareholders over the next two years. Additionally, eBay is highly focused on driving meaningful operational improvement as indicated by recently announced significant restructuring measures, including streamlining operations by consolidating the company's marketplaces regions under a single global leadership team while also funding significant incremental investments in payments and advertising initiatives.

Devin Wenig, president and CEO of eBay, stated: "Over the course of the last two months, we've met with a number of shareholders to understand their views. The bottom line is that we all share common ground: we see tremendous opportunity ahead and want to see eBay's full potential realised over the long-term. The initiatives we are announcing today are the result of this constructive dialogue."

Jesse Cohn, partner at Elliott, stated: "Our discussions with Devin and the board have been positive and productive, and we are pleased to have worked collaboratively to reach this agreement. We are confident that the initiatives announced today will drive meaningful shareholder value. Personally, I am looking forward to joining the board and working with my fellow directors towards our mutual goal of positioning eBay for success and value creation."

Peter Feld, managing member of Starboard Value, stated: "We are pleased with the changes underway at eBay and look forward to seeing the results of the company's announced operating and strategic reviews. We welcome the new directors to eBay and expect to maintain an ongoing and constructive dialogue with management and the Board."

EBay has announced initiation of an operating review, which will be led by the eBay management team and overseen by the board of directors. The operating review will target operational excellence and will build upon the recently announced reorganisation and restructuring measures in order to drive enhanced revenue and operating income growth. EBay intends to announce the findings and targets from this review at an event in the Fall.

EBay, with the assistance of external financial advisors, has initiated a strategic review of its asset portfolio, including but not limited to StubHub and eBay Classifieds Group.

In support of these strategic initiatives and consistent with its commitment to board refreshment, eBay will immediately add Jesse Cohn of Elliott and Matt Murphy of Marvell Technology to the board of directors. Further, eBay will add a third new independent director later in the year and continue to examine how the board can maintain the appropriate mix of skills, qualifications and diversity of backgrounds to best represent the company's stockholders.

"We are confident that both Jesse and Matt will add valuable experience and perspective to our board, and we look forward to working with them to execute our strategy and best serve all our shareholders," added Wenig.

EBay has entered into a cooperation agreement with affiliates of Elliott, who hold more than a 4 per cent economic interest in eBay. It has also entered into a cooperation agreement with affiliates of Starboard Value, who hold an economic interest of approximately 1 per cent in eBay. Under the terms of their respective agreements, each of Elliott and Starboard has agreed to certain standstill, voting, and other provisions with eBay. (SV)

Fibre2Fashion News Desk – India

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