PayPal Share Soars 18% in Pre-market as $53 billion Stripe-Advent Buyout Report Surface

July 15: PayPal soared in premarket trading Wednesday morning after Stripe and Advent International were reported to have submitted a joint bid to buy the payments company for more than $53 billion. 

The stock was trading at $56.10 16, an increase of $8.73 16, or 18.43%, as of 6:09 am ET. PayPal closed Tuesday at $47.37, down 0.59% for the session. 

As Reuters reported Wednesday morning, payments platform Stripe, and private equity firm Advent International are offering $60.50 a share to buy PayPal. At $60.50 per share, the deal would value PayPal at more than $53 billion, Reuters reported. 

The bid, which was made earlier this month, values PayPal at a premium to Tuesday’s closing price of 28% and included about $50 billion in committed bank financing, Reuters reported. 

PayPal has yet to comment on the proposal, which would leave Stripe and Advent holding equal ownership of the company. Both companies want to hold further talks over the next several weeks. 

PayPal’s bid price in premarket trading saw 400 shares trading at $56.03 as bids and 200 shares trading at $56.11 as asks. Volume is exceeding 4.68 million shares before the market open. 

PayPal’s 52 week range has been $38.46 to $79.50. Wednesday’s move back toward $56 is toward the middle of that range, which is a stark contrast to where the stock has spent months trading closer to its yearly lows. PayPal is down 18% over the past year. 

Advent International declined to comment. CNBC has contacted PayPal and Stripe for comment. 

The Wall Street Journal reported earlier this month that Stripe had a valuation of roughly $159 billion. CNBC reported in February that Stripe was in the early stages of considering buying PayPal. 

Now it appears those talks have evolved into a serious bid, as Stripe has teamed up with Advent International, and submitted a firm offer to PayPal’s board. 

PayPal has struggled to differentiate itself in crowded payments landscape as it faces competition from legacy card networks, as well as startups and companies like Stripe. Earlier this year, PayPal set disappointing guidance for 20 26, forecasting that full year adjusted profit would come in between a low single digit percentage increase and decrease. 

PayPal ousted CEO Alex Chriss this year after he joined the company to help right its ship but was unable to stem declining growth. Chriss was replaced by HP’s Enrique Lores, who PayPal appointed as its new president and CEO. 

“In our view, PayPal is making significant investments to turn growth around,” a July 7 note from Citi analysts said. “However, investors are skeptical that management can turn the company around after previous attempts.” 

If a deal is reached at a significant premium to where the stock is currently trading, it would be a major change in trajectory for PayPal after a rocky period on Wall Street. 

Source

• https://www.nasdaq.com/market-activity/stocks/pypl/advanced-charting