Ebay and Paypal Splits

eBay and PayPal are going their separate ways, with the payments company moving out from under the eBay umbrella to form its own, publicly-traded company. The move follows a strategic review conducted by eBay, Inc. and its Board of Directors, and is intended to help both businesses grow faster in their respective markets.
The spin-out of PayPal is expected to be complete by the second half of 2015, provided all regulators sign-off on the agreement. As TechCrunch reported, both companies will get new CEOs as part of the deal, with eBay Marketplaces President Devin Wenig taking over at eBay, and PayPal President Dan Schulman presiding at PayPal.
This is a split that many, including activist investor Carl Icahn, have predicted or called for in the past. eBay picking up PayPal was about trying to inject some energy into its instant buy, same-day delivery and curated storefront businesses, but with PayPal’s forays into mobile payments, including its Braintree acquisition and its One Touch system, the company is moving more and more towards in-person mobile transactions and away from online commerce.
eBay still manages around $20 billion in annual mobile sales volume, according to the company today, but ultimately its business has been bolstered heavily by PayPal’s strong growth. PayPal could also be opening itself up to opportunities with several of eBay’s strong competitors by separating itself from the online marketplace, including world leader Alibaba.
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Milan Tomic

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