Activist investor Carl Icahn poured the pressure on eBay Inc. (Nasdaq: EBAY) Thursday in his third scathing open letter to eBay shareholders.
In what has become a wicked war of words between the corporate raider and the online auction and shopping site, Icahn continued to press eBay to spin off its electronic payment arm PayPal, maintaining the unit is worth more as a standalone.
The billionaire investor also wants the San Jose, Calif.-company to overhaul its corporate board. Icahn, who holds a 2.2% stake in eBay, continued to reproach the company for a "complete disregard of accountability" and took further jabs at board members.
Icahn, serious and impatient, also challenged eBay's board to "an honest, accurate debate."
Objections to eBay board members heated up as Icahn questioned the future direction of eBay.
Icahn claims Scott Cook, founder, former chief executive officer, and current board member of Intuit Inc. (Nasdaq: INTU), the maker of TurboTax and other business and personal financial software, has business interests that present a direct conflict of interest.
"Having Mr. Cook on the board while planning PayPal's future is akin to having Pete Carroll, coach of the Seattle Seahawks, sitting in when the Denver Broncos were constructing their game plan for the Super Bowl (then again, maybe he did)," Icahn said earlier this month.
Additionally, Icahn objects to venture capitalist Marc Andreessen's eBay board post. Andreessen is a director on seven boards, including Facebook Inc. (Nasdaq: FB) and Hewlett-Packard Co. (NYSE: HPQ).
In Thursday's message, Icahn reiterated he has found multiple lapses in eBay's corporate governance. He is calling for Andreessen and Scott to resign from eBay's board and urges investors to vote for two of his employees for seats on eBay's board.
The sentiment in Icahn's latest letter mirrors his tone in the previous two. Last week he wrote the following criticism:
"I am frankly growing a bit tired of reading eBay's repetitive evasive responses to the legitimate issues we have been raising. Their messages all sound the same. Repeating the same mantra-'world class' board, 'world-class' board, 'world-class' board - over and over again might work in a totalitarian state where only one side gets to speak. But, thankfully, we live in a democratic state where there can be a voice of reason on the other side."
Pierre Omidyar, eBay chairman, founder, and largest shareholder, responded to Icahn's letter Thursday, accusing him of "making unsubstantiated claims about our company - and deliberating impugning the integrity of our directors."
Omidyar went on to say both Scott and Andreessen have impeccable credentials and his "full support."
Gunning for changes and shareholder support, Icahn accused Andreessen of "pre-empting" eBay's planned IPO of Skype, a freemium voice-over IP service.
In 2009, Andreessen was part of an investor group that purchased Skype from eBay at a discount to what eBay paid for it. Andreessen's group then turned around and sold Skype to Microsoft (Nasdaq: MSFT) two years later for $8.5 billon, pocketing $4 billion from the deal.
Icahn claims that profit came at the expense of eBay shareholder. He's calling for a thorough investigation and demands to inspect "all books and records" associated with the sale.
Additionally, Icahn alleges Andreessen is funding or advising several PayPal competitors "all the while potentially having access to nonpublic information regarding PayPal's operating performance."
Known for strong-arm performances, Icahn believes it's his job to take a stand on behalf of fellow investors against acts of mismanagement (typically resulting in a significant financial windfall for himself).
In a nod to Icahn's prowess, shares of eBay rose 2% Friday, to a 52-week high of $59.59.
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