PayPal in advanced talks to buy Sweden's iZettle

PayPal bags iZettle in $2.2bn move into bricks and mortar commerce

PayPal bags iZettle in $2.2bn move into bricks and mortar commerce

It has since expanded into software and financing services to support small businesses.

While PayPal predominates as an alternative payment mechanism for websites and other online merchants, it lacks the kind of hardware and infrastructure to enable small business owners to take card payments via mobile technology.

The price being paid by PayPal - itself valued at more than $90bn (£66bn) - is double the valuation that iZettle was reported to be seeking from a listing on Nasdaq Stockholm.

IZettle has almost half a million merchants on its platform and expects to generate gross revenues of $165m (£122m) in 2018, processing total payments of around $6bn (£4.4bn).

PayPal president Dan Schulman said: "This combination brings together iZettle's in-store expertise, recognised brand and digital marketing strength with PayPal's global scale, mobile and online payments leadership, and trusted brand reputation".

US-based Paypal was formerly part of eBay, but is now a standalone digital and mobile payments company.

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.

In an open letter, Jacob de Geer, co-founder of iZettle, talks about the Paypal acquisition and what it means for the future of the company.

The $2.2 billion PayPal is putting up for iZettle is the San Jose, California-based company's biggest ever deal, according to data compiled by Bloomberg. The company plans to go public. The deal will be closed in all-cash, and it is expected to help the company to provide a better service, worldwide. This is not the first time PayPal acquires startups with brilliant tech, but in this case, iZettle would have become a potential rival, had it raised enough funds via IPO.

The deal should be concluded by the third quarter of the year. The completion of this transaction is subject to customary closing conditions, including regulatory approvals.

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