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EBay's Acquisition and Spinning off of PayPal
In 2015, eBay spun off PayPal into a separate company under shareholder pressure. At the time of trading, PayPal was worth one and a half times the value of eBay. Today, PayPal has a market cap of $46 billion. We examine whether it was a good decision for eBay to acquire PayPal for $1.3 billion. We consider the impact on eBay's marketplace business and the growth of PayPal. Would PayPal have grown as it has if eBay hadn't acquired it? Let's discuss.