Elliott announces over 4% stake in eBay, sees path to $55-$63 per share
Elliott Management, which manages funds that beneficially own more than 4% of eBay, released a letter outlining what it views as "a significant value-creation opportunity at eBay." The letter, addressed to the company's board, noted that the opportunity could lead to eBay being valued at $55-$63 per share, representing upside of more than 75% to 100% from today's price. Elliott said: "Despite its remarkable history as one of the world's largest e-commerce platforms, eBay as a public-company investment has underperformed both its peers and the market for a prolonged period of time. While eBay's core Marketplace continues to enjoy sustained growth and the two other franchises that eBay owns, StubHub and eBay Classifieds Group, are thriving, eBay suffers from a deeply depressed valuation due to its history of misexecution. Elliott believes that eBay is worth far more - but change is urgently needed to address both public perceptions and real business issues." Elliott urged eBay's board to adopt a five-step plan, consisting of undertaking a comprehensive portfolio review, "revitalizing" Marketplace, making operational improvements and margin expansion, returning substantial capital to shareholders and needing "effective leadership and oversight." The letter, which goes into each of the five steps in detail, concludes that the Enhancing eBay Plan will "not only maximize shareholder value, but also best position the platform that supports the entire eBay community to enjoy long-term success," Elliott stated in a press release.