PayPal Will Soon Be Acquiring iZettle for About $2.2 Billion

PayPal Will Soon Be Acquiring iZettle for About $2.2 Billion

PayPal Will Soon Be Acquiring iZettle for About $2.2 Billion

The current CEO of iZettle, a company based on Stockholm, will report to the PayPal CEO and both companies want to improve the technological aspects of offline payments in many parts of Europe.

The decision from iZettle comes just over a month after Spotify became arguably Europe's largest startup to refuse to sell up to a US or Asian investor, listing on the New York Stock Exchange for about $27 billion. The deal expands PayPal's in-store expansion opportunities in its current markets and help the company push omnichannel commerce services in Australia, the United Kingdom and the US.

The deal also sets PayPal on a collision course with Twitter founder Jack Dorsey's e-payments platform, Square, which offers a similar platform that lets small businesses accept card payments by plugging a card reader into their smartphones.

"Small businesses are the engine of the global economy and they are increasingly demanding a partner that can provide a one-stop solution to help them compete and win online, in store and via mobile". It turns out that iZettle represents PayPal's biggest acquisition by quite some distance.

Based in Stockholm, iZettle was founded in April 2010 by Magnus Nilsson and Jacob de Geer, with the company de Geer's fourth start-up.

iZettle will serve as an European center of excellence for PayPal's in-store product and services offerings, after completion of the deal. The combination will give PayPal in-store capabilities in 11 markets including Brazil, Nordic countries, France, and Mexico. The company is expected to process payments worth $ 6 billion in 2018 and generate $ 165 million in gross revenue.

It was less than a month ago when iZettle announced it would go public, with hopes that new funding would help the company grow and expand. The two companies will continue to operate independently until close.

Subject to customary closing conditions, the deal is expected to be completed in the third quarter of this year.

Evercore is acting as sole financial adviser to PayPal, and Skadden, Arps, Slate, Meagher & Flom LLP and Roschier are acting as its legal advisers with regard to the transaction.

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