EBay said Friday that it would consider selling the ticket-sales service StubHub, its classified advertising unit and other assets in a potential revamping of the online retailer meant to appease restive shareholders.
The company also said it would add three new directors to its board, and that it had reached settlement agreements with the activist hedge funds Elliott Management and Starboard Value, which have been pressing management for an overhaul.
As part of the strategic review of its portfolio, eBay suggested that it would closely examine its core marketplace business and consider unwinding some expansions into adjacent businesses.
The move comes as shareholders express dismay over the stagnant performance of eBay's stock over the past several years. The company's shares had fallen about 17 percent in the 12 months before Elliott and Starboard unveiled their ownership stakes in January.
Among shareholders' main concerns is the way Amazon has used its dominance in online retailing to muscle its way into eBay's core marketplace business.
EBay has bowed to pressure from activist investors before. Three years ago, it agreed to spin off its PayPal payments business in the face of criticism from Carl Icahn, who said the company was among the worst-run he had ever seen.
EBay insists it has already embarked on investor-friendly initiatives, including introducing a quarterly dividend and committing to returning $7 billion to shareholders over the next two years. It said Friday that it also has streamlined its international operations and taken steps to increase advertising revenue.
The settlements announced Friday head off what could have been an arduous board fight led with Elliott and Starboard, two of the biggest and most successful activist hedge funds. Elliott owns a roughly 4 percent stake in eBay; Starboard owns about 1 percent of the company.
In a letter to eBay's board in January, Elliott urged the company to consider selling StubHub and the classifieds business, saying such transactions could bring in more than $16 billion.
EBay made no commitment on Friday to selling any of its businesses, and it appears unlikely that the company would act on another Elliott proposal: selling its core marketplace business to a private-equity firm or other online retailer.
Business on 03/02/2019