Market makers on Bloomberg Television. I am Erik Schatzker. I am Stephanie Ruhle. Im here at the nasdaq at the founder summit. This brings in great names like aero and oculus, and the bankers to represent them including Goldman Sachs and blackstone. P are hot. Is stephanie, looking forward to it all. On assignment not too far away in midtown manhattan this morning. In the meantime, the monthlong feud between ebay and carl icahn appears to be over. This will give him confidential access to the company, and he has withdrawn his demands for a paypal spinoff and 2 seats on the board. I spoke to ceo john donahoe in the morning, who characterizes this as a win for shareholders. I asked him, why give carl icahn anything at all. What he has done is seeing the potential in the opportunity in our company. So he is becoming a longterm shareholder, which i think is a winwin. And dave dorman is coming on as an independent director. An independent director that i respect and that carl respects. I think that this is a good addition to the board, and i think it will allow us to exercise the enormous opportunities in front of us. Icahn versus ebay, is this over . We bring in trish reagan, who has spent a lot of time on this, ebay and donahoe said this is an agreement, carl says this is a detaunte. Of this takes the fight out of the public arena. It seemed like we were getting this on a weekly or daily basis, we were Getting Press releases from both sides. Carl would tweet something, ebay would put out a press release, carl would Say Something else and ebay would come out with another press release. This was sort of a titfortat arrangement. And i think that the feeling eventually on both sides is that this is not healthy, this is not the right thing to do. Carl says he would like to see paypal be spun off. He will have these conversations with management, privately, as opposed in the public arena. When you say that they both came to the conclusion that it was best to take this out of the public domain, and i had the same thing from donahoe this morning, it leaves me wondering why. Carl icahn has never been afraid of a public fight and to wage a public campaign, in the case of dell, four months and months with no sign that he is tiring of the whole thing. Iswhat is interesting, eric, that ebay shows no signs of tiring. It was an interesting story to be covering because both sides were in it to win it. And you dont always see it. You might see an activist come out swinging but sometimes the company tries to get along, a little bit better, and this is a company and this is a ceo, john donahoe, who came up almost as hard. Might things have worked out differently if carl had made more money on the stock . We know that he started to build his position in early january when the shares were trading at about 52, and he has since accumulative more, so now he is a two percent stockholder, and a stock is at 54. 71. He may noteverage, have made much money or may have lost money. He may be thinking this is a better tactic. If you are working with management and fighting management in the public arena, maybe this will get you further. I think that he would like to see that paypal spinoff. But going after Marc Andreessen and other members of the board, at the end of the day it was decided that this was more of a distraction than getting to the end goal. I am just hypothesizing. He did bring up the important point of calling attention to this inherent conflict of interest that you often see. Lets talk for just a second before we wrap up about the message that this since to corporate america. Sins to corporate america. America. To corporate all that you have to do to a company is 8. 2 per 0. 82 of the stock. It is almost like he held ebay hostage and they had and they had to give up something. What happens when the next activist investor holds things holds them hostage, 0. 82 . Naturally, he doesnt look at it this way. Nobody held me hostage. But is in that kind of what carl icahn does . The flipside of that is that activists are performing a role that is needed in the market economy. Because they are getting in there and they are agitating and there is always the danger in any company and with any board that people get a little bit lazy and they kind of go along. There is certainly a danger. And then you have someone in there who says, i think it would make more sense to do this or do this, and is one thing for an analyst to do that. It is another thing for someone who owns part of the company, even if this is only. 85 . Healthy debates for the original company and the activism. They can get in there and do a little bit more and hopefully this is a good outcome. That is trish reagan, who will talk to carl icahn at 2 p. M. Here on Bloomberg Television. Get his side of the story on this truce with ebay. Has been taking off this year, but companies that are flying high might be in danger of crashing and burning. This is an apocalyptic scenario. Stephanie is the talking to ivan brockman, a man with more than 15 Years Experience advising companies in tech as well as an investment banker and an attorney. It is all yours. Ivan, welcome. All morning we have been talking about carl icahn and ebay. Activist investors seem like they are here to stay. You work with all of these companies. How do they pay for this . Stephanie, it has evolved over time. 10 years ago, the notion of activists in technology was a new phenomenon and now this is here to stay. Many of these activists do a terminus amount of homework before building their positions and when they build their position they want their ideas and their voices to be heard. I think in the boardrooms of technology companies, this has also evolved and there is more of an understanding of what the activists are trying to achieve, and there is more of a willingness overtime, perhaps not immediately at the announcement but over time, to have productive discussions and negotiations. Why do we need these activist investors . At some level any company that has been in business for a be stuck in at certain momentum, or a certain set of ways about doing business. On occasion the activists bring up good points that are hard for the companies, in some cases, to raise on their own when they are trying to be positive and constructive about the future outlook. Activists have the ability to get down to the nittygritty and say things that others may not be willing to say. The other criticism is valuations. When i think of blackrock and blackstone, a true value investor, why would you want to be somewhere where valuations are so overthetop through the roof right now. Website andat a say, 19, i am into that. I look at to have scum a one is the primary half and i can actually justify this on multiple metrics, on why this was a good deal for facebook. But as an investor, blackstone is emerging as an increasingly increasingly interested in technology, we have done so many transactions over the last two months of significant size, and i think there is an effort to continue to invest in technology. The valuations notwithstanding in some sectors of technology, will not necessarily be attractive to blackstone, per se, as an investor. But there are plenty of opportunities for companies that prospects,growth profitability prospects, and quite frankly want to partner with like stone. And you think Cyber Security is that special place right now. Why . At blackstone, we have a cross disciplinary set of capabilities and excellence, everything from our internet cable internal capabilities and capabilities across the Portfolio Companies, and in particular, the investors investors of Blackstone Capital on the advisory side. Landscaperveyed the and we know all the players and we think there are great values to be had there as well as a platform to be built. Recently we invested in a Company Called we see a lot of smaller Tech Startups ought knocking on your door and saying, i am ready to sell. You have to start thinking, this is a mom this is the moment. Is your phone ringing off of the hook . It is very busy and the activity level is at a fever pitch. But not all companies are created equal. There is inherent value in accumulating more than half a billion users, and not all companies have that level of Critical Mass. We look to growth and Critical Mass and we look to, if not nearterm profitability, longterm profitability prospects. Is the market looking at these companies with enough of a critical eye . When i look at the ipo market it just seems that every deal that is just so hot is a tech company. That makes you wonder, are we in 1999 again . We are not in 1999, that is the environment where every company went up, and had very little ability to go down even with bad news. There is a differentiation between the winners, and if not the losers, those who are not growing as quickly. In theview as healthy market, is, even with the recent selloff, some sold off more than others and others stayed down. If the generally healthy market is making the call as the best he wants to make for longterm profitability. We are finally seeing facebook made it make big acquisitions. Is this why Companies Like apple but have so much cash on the balance sheet, is the facebook activity egging other guys say, i need to start spending . When we look at facebook and apple and twitter, oracle and all the others, they are competitors are some level for the same assets, the same companies that will provide them with growth in the future. And so the voracious appetite of some Companies Like facebook actually creates a little bit of pressure in the discussion. For you, this is a Company Everyone likes to talk about, where do you stand on snapchat . Tremendous value. I look to my children as a good barometer for what is happening. My children are on snapchat. This is an Important Message to me. Instagram bute on they are not on facebook classic. I look at what apps and innovative ways of communicating that my kids in the current generation are using. For what will have breakout growth. Someone who is using facebook classic, this girl. Thank you so much. Eric, i will send it back to you in the studios. Here we are at the founder summit. That was a good interview with ivan brockman. Stephanie, we will see you shortly. We have imf managing director Christine Lagarde coming up next. Tom keene will be speaking with her in a few minutes. And Ally Financial raise more than 2 billion for the ipo. I will be speaking with the ceo, Michael Carpenter later on this hour. Ou are watching Market Makers on Bloomberg Television, streaming on your mobile device and on tv and on apple tv and fire tv. Live from bloomberg headquarters in new york, this with erik makers schatzker and Stephanie Ruhle. You are watching Market Makers on Bloomberg Television, i am Erik Schatzker. The u. S. Recession is in the rearview mirror, and europe and even japan is taking measures, you could say that the developing world is getting its act together. But the emerging markets are newly vulnerable, that is what they are talking about, in washington this week. This is where we find our own tom keene. Tom, talk to me about the mood in washington. What have you started to hear since you landed yesterday . Always, interesting, as at the World Bank Meetings and we will talk about the spring meeting, with us right now is the president of the world bank. Many americans know him as the president of dartmouth college. From the faculty lounges of dartmouth, let me first talk about the extreme poverty. Why do you look at extreme poverty versus so much of the worlds challenges that you know of . The fact of the matter is that there are so many people dayng under one dollar per and for them up most of the world that is just as bad as it sounds. It is very difficult to live under one dollar per day. We had to focus our efforts to try to help these people and lift them out of poverty. What is your biggest surprise, as you parachute into this huge infrastructure bureaucracy, from a policy standpoint, what has been your best practice that you have learned. Of the great thing is that we have 1000 economists, 2000 phds, one of the most brilliant groups of staff that i have ever seen. The great thing is these guys are here because they are passionate about fighting poverty. I would not guess that coming in. This whole Movement Really comes from the staff. These are folks who could have made a lot more money on wall street, or anywhere doing their work, but they are here because they want to do something about corporate what percentage of americans get a Home MortgageHome Mortgage at a little bank. You have to reframe the message. You do this with huge criticism. The Financial Times i guess that they they minced no words about it, after two years on your watch, they want you to step up on your reform. Do you feel an urgency to reform . The issue was they were reforming too fast. I came to this institution and we realized that the world was changing tremendously. All of the foreign aid this is 125 billion. This may sound like a lot but africa needs 100 billion per year for infrastructure, almost 5 trillion over the next five years. The potential development is small but the key to develop the future is to bring all of the public money that we have together, with the private sector, to these developed economies. The reason we are going through all of these changes, is that we now have to be fit for purpose for the future. We believe we are getting there. I want you to go over to New Hampshire and across the Connecticut River to white river junction, one of those famous diners and you have to sell the world bank to americans. How do you sell your institution to the average american . First of all, american jobs depend on how well the developing world is doing. Than 50 of all exports to the United States go to the developing world, to create thriving economies where there are consumers, and people are interested in american goods. This is critical for more than half of the american economy. Remember the raging Party Debates with my parents over finance, and the rest of it. That is not the modern world bank, you call that the solution bank, define that for the viewers. What is the task for any country. They have to be competitive. I have to invest in their people so future growth will happen. And so we work with 140 countries, we work with them on just that problem. How can they grow their economy in a way that is in crude is inclusive. What we have found is there is there are huge amounts of society, withany political instability and what have we learned from that . And there is a drag on growth. If you dont have enough opportunity for everyone to participate in the market this is a drag on growth. You have to invest in people. We know greater house Greater Health outcome drives growth. And you are a fund hedge reese hedge fund researcher. If you are with Warren Buffett right now, what would you say is the number one issue the world bank needs help with . I talk with bill all the time about these issues. They are very focused. The ceo of microsoft . Definitely not. I did not know about this. Bill and i talk all the time. What he is doing is investing in the upstream research. What he knows is that we can build systems on the ground, the Health System that will deliver those new vaccines and those new drugs. The common thing is every country in the world has a problem with the health care system. Costs are too high in the city. Russia and brazil and every single one. Finance ministers are talking about the incredible cost in the cities and at the same time they can get care into the outer area. What will the world bank it do to fix that . We are putting the other team that we believe will be the best in the world to decrease the number of possibles that you build and focus on primary care, making sure you get it out there, primary care is the key, here and out there. Do you support the Affordable Care act, is america doing it right with obamacare . For me, i have worked my whole life with improving access to care. This is an important part of increasing access to care. There are other things of altering to tackle inequality in price. These are the things we have to tackle. But for me, having worked my whole life on care, how can we not like something that improves access . I dont know the inner workings of this bank, i suggest 120 of 100 viewers dont know the inner workings. How will you boost the morale of arguably the safest office space that appears in washington . Dartmouth hockey is not going to get it done. Think about how this organization has not been through major change since 1997. In order to update the institutions, for the purpose of the new world, we bring in public and private sector work unlike like it has ever happened before. Multilateral brecker sees do not like change. We are going through that change and that is not such a surprise to me. Everyone will understand that we built an organization here, just to tackle the future, which is that everyone will have more access to knowledge, and we will be much better at organizing the knowledge our knowledge and delivering it to the country. We have to be much better at delivering public and private together, and we have to go through the process of being leaner. All of this makes people nervous to have been working here for years. They will get over it and we will be ready to go soon. One last question, what do you and <