PayPal Soars On Reported $53 Billion Buyout Bid From Stripe And Advent
PayPal shares surged the most on record in premarket trading in New York after Reuters reported that payment company Stripe and private equity firm Advent International have offered more than $53 billion to acquire the struggling payments platform.
PYPL shares are up 20% premarket...
It's the biggest single-day jump since at least 2015 (which is near the lows where it is currently trading)...
Bloomberg noted call option volume surged ahead of the Reuters report:
Call option volume and implied volatility for Paypal surged ahead of a report that Stripe and Advent had made a bid for the digital payments firm, indicating some traders were well-positioned ahead of the news.
The proposed $60.50-a-share bid represents a roughly 28% premium to PayPal's Tuesday close, though it remains 80% below the $308 peak recorded in July 2021.
Here's more from the report:
The offer, submitted earlier this month, is backed by about $50 billion in committed financing from banks, said one of the people. The offer represents around a 28% premium to PayPal's closing share price on Tuesday.
Rumors of a potential acquisition first surfaced in late February when Bloomberg reported that Stripe had expressed interest in PayPal.
Related:
PayPal was one of the early pioneers of digital payments, but the company has quickly lost ground as consumers shifted to alternatives such as Apple Pay and Google Pay.
New CEO Enrique Lores has framed his turnaround around cutting costs, simplifying the organization and refocusing the company's strategy. But with competitive pressures mounting and the shares trading at near all-time lows, an outright sale may offer a more credible exit strategy.