Stripe, a payments company, and Advent International, a private equity firm, have jointly offered to buy PayPal Holdings Inc. for $60.50 per share. This purchase would put the payments company’s valuation at over $53 billion.
The offer, which was made earlier this month, is supported by roughly $50 billion in pledged bank financing. The offer is around 28% more than PayPal’s Tuesday closing share price.
The idea is based on a preliminary strategy developed in early April. Stripe and Advent are hoping to forward talks in the upcoming weeks and have not heard back from PayPal.
Instead of dividing the company, the idea calls for Stripe and Advent to jointly own PayPal with an equal stake. There is no guarantee that the strategy will result in a transaction.
PayPal was a pioneer in digital payments when it was founded in the late 1990s. However, as customers have adopted alternative payment methods and competitors like Apple Pay and Google Pay have increased their market share, PayPal has faced growing competition.
Much of the value it acquired during the pandemic has been erased during the past few years as it struggles with slowing growth and escalating competition in digital payments.
The market valuation of the corporation dropped to as low as about $36 billion this year after peaking at roughly $360 billion in 2021. Over the previous 12 months, it has lost approximately 40% of its market value.
Enrique Lores, the CEO of PayPal, began a comprehensive turnaround effort to streamline and sharpen its focus on growth after taking over in March.
Along with a number of management changes, the business divided its operations into three divisions in April: checkout, consumer financial services, Venmo, and payments and cryptocurrency.
GLOBAL PAYMENT AGREEMENTS.
If the proposed PayPal deal is finalized, it will contribute to the recent M&A activity in the global payments industry, where buyers have targeted firms amidst the rapid advancements in artificial intelligence and financial technology.
In contrast to the sluggish growth of traditional payment processing, payment companies are increasingly looking for scale through M&A as well as exposure to faster-growing categories, including cross-border and business-to-business payments.
In a complicated three-way transaction in 2025, Global Payments agreed to buy rival Worldpay from FIS and private equity company GTCR for $24.25 billion. As part of that agreement, FIS sold its remaining 45% interest, and GTCR sold its 55% stake.
A constant flow of smaller transactions has also occurred in the sector, such as the $2.75 billion purchase of Payoneer Global by Canadian payments company Nuvei. Advent International and other private equity firms support Nuvei.
In response to worries about a crucial asset being owned by Americans, Mastercard is investigating selling the bulk of its UK payments company Vocalink back to British banks, according to a report this week in the Financial Times.
In the first quarter, PayPal’s revenue increased by 7% to $8.35 billion, exceeding analysts’ average forecast of $8.05 billion. Total payment volumes increased by 8% to roughly $464 billion on a currency-neutral basis.
In May, Lores presented intentions to use artificial intelligence to reduce redundancy in personnel layers and improve procedures throughout the organization, but she did not go into further detail.
According to the corporation, these actions will save approximately $1.5 billion over the next two to three years, which it would then reinvest to spur new growth.
One of the most valuable businesses in the sector is Stripe that is privately held. In February, a tender offer for shareholders and employees valued it at $159 billion, a more than 70% increase from a comparable share sale a year ago.
The company, which has offices in Dublin and San Francisco, enables businesses to automate financial procedures, collect payments, and issue settlements.
