Stripe and Advent Abandon Deal to Acquire PayPal

Payment company Stripe and investment fund Advent International have decided to withdraw from the planned deal to acquire PayPal, according to Bloomberg. The three companies did not provide a comment. PayPal shares are falling by 15% in pre-market trading in New York.

In July, Stripe and Advent submitted a purchase offer for PayPal at $60.5 per share, a price 28% higher than PayPal's closing price on Wall Street at the time the offer was submitted. This price reflected a valuation of more than $53 billion for the payment company. According to the plan, Stripe and Advent were to hold equal stakes in PayPal.

Reuters reports that PayPal's board of directors deemed the purchase offer insufficient and cited regulatory and financial obstacles. PayPal did not officially respond to the offer.

PayPal was founded in the late 90s, with founders including Peter Thiel and Elon Musk. It was one of the first players in the digital payments industry. However, in recent years, it has faced increasing competition due to the shift of consumers to alternative payment methods and the progress of Apple Pay and Google Pay, which control growing market shares.

The company's market value climbed to a peak of $360 billion in 2021, but fell to a low of $36 billion this year. Over the last 12 months, the company has lost more than 40% of its market value. In March, Enrique Lores was appointed CEO and began an extensive reorganization program aimed at simplifying operations and focusing on growth.