Will Spinoffs, Layoffs Make eBay the Yahoo of 2015?

If the tech industry is a hub for dealmaking, expectations are brewing that e-commerce may be the busiest sector this year.

Auction site eBay (NASDAQ: EBAY) is stirring the pot the most after announcing with its earnings Wednesday that it may sell or IPO its eBay Enterprise business, which runs online shopping for companies with physical stores. That comes on the heels of plans it announced last year to split off its PayPal unit in late 2015.

Meanwhile, the company plans to layoff about 7 percent of its employees, or 2,400 people. All of the news may make eBay’s stock the Yahoo (NASDAQ: YHOO) of 2015, according to RBC Capital Markets analysts. Plans for Alibaba’s IPO helped drive Yahoo’s stock up 14 percent in 2014, the analysts wrote. While investors may wait until the second half of 2015 to see what happens with eBay, the spinoffs could create value in the company, the analysts wrote in a note published this morning.

Who exactly might acquire any of eBay’s units, or the company itself some day, remains the speculation of analysts and the media. Amazon, Google (NASDAQ: GOOG) or Alibaba (NYSE: BABA) are all potential acquirers Reuters named, citing Wall Street analysts. Re/code senior editor Jason Del Ray estimates that Alibaba could buy eBay to help with its lack of U.S. consumer presence, while Walmart (NYSE: WMT) could purchase PayPal.

Amazon (NASDAQ: AMZN) seems currently outside of this fray, though it is certainly involved in M&A. It is in talks to buy a chipmaker based in Israel called Annapurna Labs, according to multiple reports.

EBay stock has risen 4.8 percent today to $55.93 as of 11:57 a.m. New York time.

David Holley is Xconomy's national correspondent based in Austin, TX. You can reach him at dholley@xconomy.com Follow @xconholley

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  • some dude

    Two items… PayPal, I get, but how does eBay spinning off PayPal create value for eBay? It’s doing the same thing it does pre-split? In fact, eBay loses efficiencies it gained having consolidated like teams between the two. (example: sharing datacenter costs).
    Second, eBay managers are picking PayPal management roles. This left PayPalians sour because they’re not able to move up and it left eBay engineers sour because they see their leadership abandoning ship.

  • caratuco

    They orchestrated their downfall.