EBay to spin off Skype after loss

EBay Incorporated yesterday said it expects to remain a "significant" shareholder after spinning off its internet communications service Skype.

Speaking to analysts, chief financial officer Bob Swan said the online marketplace operator intended an "ultimate full separation of Skype".

The first stage will involve the initial public offering announced on Wednesday, after which eBay initially expects to stay a "significant" Skype shareholder, he said.

Beyond that, eBay will determine the best plan to fully separate Skype, he said.

Chief executive John Donahoe said if the company received an unsolicited offer to buy Skype, it would evaluate it against how it thinks it could fare through a public offering.

The San Jose, California-based eBay bought Skype for $US2.6 billion ($NZ4.57 billion) in 2005, hoping that buyers and sellers on its online marketplace would use Skype to communicate.

That did not catch on, and eBay took a $US900 million write-down on the business in 2007, essentially acknowledging it had drastically overvalued it.

The company also paid some Skype investors $US530 million because the division met certain targets for profit and growth.

 

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