By Jonathan Davies

eBay has announced plans to split off PayPal into a separate business.

The online auction marketplace expects to split the business in 2015.

EBay's chief executive John Donahoe said: "A thorough strategic review... shows that keeping eBay and PayPal together beyond 2015 clearly becomes less advantageous to each business strategically and competitively.

"The industry landscape is changing, and each business faces different competitive opportunities and challenges."

It comes months after one of eBay's investors, Carl Icahn, gave up his fight urging eBay to sell PayPal. The activist investor ended his fight after failing to canvas enough support for his goal.

eBay bought PayPal for $1.5bn (£905m) in 2002, and it is now Silicon Valley's fastest growing company with a 16% rise in monthly active users.

PayPal's revenues are growing 19%, double that of eBay. And it is catching up in terms of revenue. PayPal annual revenue currently stands at $7.2bn (£4.5bn), compared to eBay's $9.9bn.

American Express co-executive Dan Schulman will take up a role as PayPal's new president and chief executive.

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