EBay Inc Spinning Off PayPal in A Move Proposed by Carl Icahn

The announcement Tuesday by eBay Inc EBAY that it would spin off its PayPal unit provides a victory for activist investor Carl Icahn.

Icahn had long proposed spinning off the PayPal business as a way to unlock shareholder value.

Icahn, the seventh largest shareholder, controls about 2.48 percent of the outstanding shares in eBay, holding 30.8 million shares in the company as of a June 30 filing. He had previously pushed for two board seats, ending up settling with former AT&T CEO David Dorman as a director.

EBay is up 7.5 percent at $56.50 in pre-market trading, representing a more than $118 million gain for Icahn on his eBay stake.