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eBay CEO: Skype Could Be Sold If Synergies Fail

eBay (NSDQ: EBAY) CEO John Donahue has made his first comments directly addressing a possible sale of Skype, acquired by predecessor Meg Whitman for $2.6 billion in 2005. He told the FT that this would be the year of testing synergies between Skype and the core business and that “If the synergies are strong, we’ll keep it in our portfolio. If not, we’ll reassess it.” Of course, synergy between Skype and eBay’s other businesses—PayPal and auctions—was part of the original rationale for the deal, but that’s been slow in coming. Donahue: “What we know is, Skype is a great stand-alone business.” He predicted that Skype will do at least $500 million in revenue this year. That shouldn’t be tough to reach, since yesterday eBay reported quarterly Skype revenue of about $126 million. As for PayPal, Donahue said there’s no reason to sell the unit.

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Apr 17, 2008 2:50 PM ET

Posted In: Money, M&A & Venture Capital, Mergers & Acquisitions, ebay, john donahue, skype

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