A proposed deal backed by $50 billion in financing could reshape the global digital payments market.
Stripe and private equity firm Advent International have made a joint offer to acquire PayPal for $60.50 per share, valuing the payments giant at more than $53 billion, according to people familiar with the matter. The proposal has sparked fresh interest in one of the biggest potential deals in the fintech sector.
KEY DETAILS
The offer was submitted earlier this month and is backed by around $50 billion in committed bank financing. It represents a 28% premium to PayPal's Tuesday closing price.
Sources said Stripe and Advent first approached PayPal in April and are hoping to move discussions forward in the coming weeks. Under the proposal, both companies would own equal stakes in PayPal rather than splitting up the business. There is no guarantee the talks will lead to a deal.
PayPal has faced growing pressure from rivals, including Apple Pay and Google Pay. Its market value has dropped sharply from a peak of about $360 billion in 2021 to as low as $36 billion this year, with shares losing more than 40% over the past 12 months.
Since becoming CEO in March, Enrique Lores has launched a turnaround plan, reorganizing the business, expanding its payments and crypto focus, and targeting $1.5 billion in savings over the next two to three years.
MARKET REACTION
PayPal shares jumped 15% in premarket trading following news of the offer. The proposed acquisition also highlights rising merger activity across the global payments industry as firms seek greater scale and faster growth.
Investors will now watch for PayPal's response and whether formal negotiations begin. If the deal moves forward, it could become one of the largest fintech acquisitions in recent years.
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Source: Reuters
Time: 4:00 PM EEST
