SAN JOSE (dpa-AFX) - Following a strategic review of its growth strategies and structure, eBay Inc.'s (EBAY) board has approved a plan to separate the company's eBay and PayPal businesses into independent publicly traded companies in 2015.
Forming two standalone businesses best positions eBay and PayPal to capitalize on their respective growth opportunities in the rapidly changing global commerce and payments landscape, and is the best path for creating sustainable shareholder value, the company noted.
The board said the benefits of the existing relationships between eBay and PayPal would naturally decline over a period of time and can be optimized in arm's length operating agreements between the two entities. Also, the business separation provides shareholders with more targeted investment opportunities; and is the best path to sustainable shareholder value.
The firm expects to complete the transaction as a tax-free spin-off in the second half of 2015. Devin Wenig, currently president of eBay Marketplaces, would be the chief executive of the new eBay company. In this new role, he would lead the eBay Marketplaces and eBay Enterprise businesses.
Concurrent with this announcement, the company also unveiled the appointment of Dan Schulman to be President of PayPal, effective immediately, and CEO designee of the standalone PayPal company following separation.
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