PayPal stock jumps 15% premarket on offer report
PayPal shares jumped in premarket trading Wednesday following reports that payments company Stripe and private equity firm Advent International had made a joint offer to buy the company for more than $53 billion.
The offer, valued at $60.50 per share, was tabled earlier this month, according to Reuters and the Financial Times, which cited unnamed sources. The price is a near 28% premium to PayPal’s closing price on Tuesday, but a sharp discount to the stock’s $78.22 trading price at this time last year and less than a fifth of PayPal’s July 2021 high of $308.52.
New York-listed PayPal shares jumped by more than 15% in premarket trade to $54.57.
Under the proposed structure, Stripe and Advent would jointly own PayPal with each holding an equal stake, Reuters reported.
Neither PayPal nor Stripe immediately responded to requests for comment, the Wall Street Journal reported. Advent International declined to comment.
The challenge for the buyers of PayPal will be fixing messy internal systems, while any acquisition could be a distraction for the already fast-growing Stripe, Simon Taylor, author of financial technology blog Fintech Brainfood, wrote on X.
Thomas Hayes, chairman of investment-management firm Great Hill Capital, wrote on X that the reported offer undervalued PayPal given its strong free cash flow and improving margins. He said even an offer of above $80 a share would present a steep discount to PayPal’s potential value.