PayPal agrees to buy Sweden's iZettle in $2.2 billion deal

Randal Sanchez
May 18, 2018

The Swedish firm is best known for its portable point of sale (POS) readers, which can plug into a smartphone or tablet to allow businesses of any size to quickly and easily begin accepting card or contactless payments.

PayPal has been forced to look at a revised business model for itself after the split from eBay, and the more recent news that it will be usurped as the main payment method of payment on the bric-a-brac site. PayPal closed the Nasdaq trading day in NY with a market value of about $94 billion based on its share price, which rose a percent to $80 in after-hours trades.

Under the terms of the deal, Zettle CEO Jacob de Greer and the company's management team will continue to lead the business, which expects to process Dollars 6 billion in payments in 2018 and have gross revenues of USD 165 million. Jacob will be reporting to PayPal COO Bill Ready.

"The opportunity to become part of PayPal was too good to pass up", he said, "The global scale and 19 million merchant relationships that PayPal has enables us to move faster and reach further than ever before".

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PayPal chief executive Dan Schulman said, "Small businesses are the engine of the global economy and we are continuing to expand our platform to help them compete and win online, in-store and via mobile". The Stockholm-based company had been aiming to achieve a valuation of $1.1bn, but was presented with double that amount by PayPal. The company declared that IZettle expects to generate $165 million revenue in 2018.

PayPal announced that it is buying European Square competitor iZettle last night, in a deal worth $2.2 billion.

The deal will also help PayPal provide a more comprehensive suite of services to its merchants. Since Paypal now does not have a strong offline presence in these markets, it will look to leverage on iZettle to penetrate into these markets. "But this is a very exciting way for the company to continue its vision".

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