EBAY eBay Inc

By Kimberly Chin 

Elliott Management Corp. wants eBay Inc. to part ways with StubHub and its classified ads business, a move the activist investor said would help eBay focus on its core online retail marketplace.

In a letter sent Tuesday to eBay's board, Elliott said StubHub, the online ticket reseller, and eBay's classified ads business is worth more on its own than as part of the e-commerce company. Elliott and its affiliates hold a 4% stake in eBay.

"Elliott believes that eBay is worth far more -- but change is urgently needed to address both public perceptions and real business issues," the activist hedge fund said in prepared remarks.

Elliott said eBay could reach a valuation of $55 a share to more than $63 a share by the end of 2020 if it focuses on its core business.

Shares of eBay, which have fallen 22% in the past 12 months, rose 12% to $34.40 in premarket trading.

An eBay representative couldn't immediately be reached for comment.

Elliott called for eBay to free up capital to invest in improving its operating efficiency and sales growth. In its letter Elliott said eBay has misallocated resources, spent wastefully and operated under an inefficient structure.

Elliott said it would collaborate with management to help it drive value.

EBay bought StubHub for $310 million in 2007 and has tried to expand the franchise overseas with the purchase of Spain's Ticketbis in 2016.

Write to Kimberly Chin at kimberly.chin@wsj.com

(END) Dow Jones Newswires

January 22, 2019 09:25 ET (14:25 GMT)

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