Elliott’s campaign at AT&T has parallels worth noting
NEW YORK - The departure of eBay Chief Executive Devin Wenig is a bad omen for another c-suite occupant, Randall Stephenson. Both the $32 billion online marketplace and AT&T have been targeted by Elliott Management. The activist is using a similar playbook at both, meaning the $273 billion telecom firm may face the same outcome.
Elliott was likely one of the catalysts. In January, the investment firm, which has about a 4% stake in eBay, asked the company in a letter to consider a range of options including selling its classified-listings unit and the ticket service StubHub. Turning around the fortunes at its core Marketplace division was also on its list. Ebay was once the premiere online shopping destination in its heyday during the late 1990s and early aughts before Amazon came along and snatched the mantle.
Elliott’s campaign at AT&T has parallels worth noting. The tone of its missive to longtime boss Stephenson and the board of directors was polite if not pointy. Like it did for eBay, the investment firm suggested the U.S. mobile carrier consider the sale of some of its divisions, including the troublesome DirecTV. And like eBay's Wenig, Stephenson was never explicitly mentioned.
It’s true that Elliott is still in the early stages of engaging with AT&T, having launched its campaign this month — it only gained an eBay board seat in March. Stephenson may prove to be a willing partner, just as the eponymous chief executive of oil producer Hess was; John Hess faced an Elliott campaign and stayed in the job.
But many of the criticisms the activist has leveled at the telecom firm involve Stephenson’s signature moves, including the $49 billion purchase of the satellite pay-TV firm. If eBay is anything to go by, Elliott may hasten Stephenson’s departure after 12 years at the top.
- EBay Chief Executive Devin Wenig is leaving the company, the $32 billion online marketplace said on Sept. 25. The board will conduct a search for his replacement, with finance chief Scott Schenkel serving as interim CEO.
- In March eBay agreed to a strategic review of some if its businesses, including StubHub and eBay Classifieds, after pressure from activist investors Elliott Management and Starboard Value. EBay also appointed two new directors to the board, including Jesse Cohn, an Elliott partner.
Bye Bye Randall, please Go! ....quietly into the twilight.