Andreessen Defends Himself Against Icahn
After a week full of disses from new eBay (NASDAQ:EBAY) investor Carl Icahn, board member Marc Andreessen has come forward to defend himself in an interview with The Wall Street Journal after letting CEO John Donahoe and founder Pierre Omidyar do it for him.
Stubborn activist investor Icahn has called out eBay’s board and Andreessen in particular for “lapses in corporate governance” that he believes to be inexcusable. “We have found ourselves in many troubling situations over the years, but the complete disregard for accountability at eBay is the most blatant we have ever seen,” Icahn said in the first of three letters to eBay shareholders that he’s released this week. Icahn has also picked on board member Scott Cook for his investments in companies that compete with PayPal and eBay.
Icahn specifically accuses Andreessen of cheating eBay shareholders out of the $4 billion profit he made from the sale of Skype to Microsoft (NASDAQ:MSFT). Skype was originally owned by eBay, then sold to Andreessen’s venture capital firm, then sold again for a huge profit to Microsoft. Icahn thinks that eBay should have pursued a deal that would have been more beneficial to shareholders when it sold Skype, but eBay has claimed that it explored all possible options for the sale and picked the best one.
“The company explored all options for divesting Skype,” eBay said, pointing out that “because Mr. Andreessen’s fund had a small stake in the acquiring group, Mr. Andreessen was recused from all decision making.” The company also said that Icahn “has cherry-picked old news clips and anecdotes out of context to attack the integrity of two of the most respected, accomplished and value-driven technology leaders in Silicon Valley.”
“EBay states the conflicts regarding Mr. Andreessen’s investments are acceptable. Mr. Andreessen has funded, sits on boards of, and advises no less than five competitors, four of which directly compete with PayPal — all the while potentially having access to nonpublic information regarding PayPal’s operating performance. Based on our research, Mr. Andreessen’s actions are by far an outlier on public markets — even for technology company boards,” Icahn said in his most recent letter.
Andreessen refuted those claims in his interview with the Journal. “If I’m on a public board and that public company is looking at buying a company in a certain space and one of my startups is in that space, I will not be part of that conversation,” Andreessen said in his first comments since the Icahn letters came out this week. “This has been established over decades of corporate governance and there’s nothing unique to tech about it.
“If we invest in a new router company, that’s it for us in routers for the next 10 years,” he told the publication, further defending the practices of his venture capital firm as being completely normal. “The top entrepreneurs are not going to take money from a VC that is investing in multiple competitors in the same space.”
“Instead of having an honest discussion about a reasonable question, Mr. Icahn has chosen to attack the integrity of two highly respected and qualified board members, Scott Cook and Marc Andreessen,” Omidyar said in a statement defending the board.
“The claims against Mr. Cook and Mr. Andreessen, in particular, are blatantly false. We challenge Mr. Icahn to end his own charade with our shareholders,” eBay said in its latest statement.
Icahn wants the company’s shareholders to oust Cook and Andreessen, and possibly even Donahoe, in addition to insisting on a spinoff of PayPal. EBay remains highly resistant to Icahn’s input. Icahn has challenged eBay to a public debate, for which CNBC has volunteered to provide a forum, but eBay hasn’t yet responded to his requests.
More from Wall St. Cheat Sheet:
- Icahn Rips EBay Board a New One in Latest Letter
- Icahn’s Battle With EBay Will Only Get Uglier
- EBay and Icahn Continue Public War of Words
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