Advent-Stripe consortium drops $50B pursuit of PayPal
What's the deal? A consortium of buyout firm AdventDealroom has a profile for this one. Try Dealroom → and payment processor Stripe has abandoned its pursuit of PayPal Holdings Inc., according to people familiar with the matter. The group had previously offered more than $50 billion for the fintech pioneer.
The players: PayPal, founded in the late 1990s, was an early mover in digital payments. Stripe processes payments for online businesses, while AdventDealroom has a profile for this one. Try Dealroom → is a private equity firm.
Why now? Bloomberg News first reported in February that Stripe was weighing an acquisition of parts or all of PayPal after a stock slump wiped out a chunk of its value. That interest helped PayPal recover, with shares jumping more than 40% this quarter to give it a market value of about $52.6 billion.
What went wrong? PayPal found the initial bid insufficient, and the two sides had been negotiating a higher price, The Wall Street Journal reported this month. The situation remains fluid, and the consortium could return later, the people said.
The backdrop: PayPal has struggled to modernize its payment technology as rivals such as Apple Inc. and Alphabet Inc.Dealroom has a profile for this one. Try Dealroom → have seized market share. Representatives for Advent, PayPal, and Stripe declined to comment.
The signal: The collapse underscores how a takeover threat can lift a lagging incumbent's stock — even without a deal — while highlighting the widening gap between older payment players and their nimbler tech rivals.
Read more: Bloomberg
Image credit: Janitors
