PayPal’s board is likely to give serious consideration to a reported takeover proposal from payments giant Stripe and private equity firm Advent International, according to analysts, as the company navigates leadership uncertainty and pressure to revive its growth.
Reuters reported that privately held Stripe and Advent submitted a joint offer to acquire PayPal for $60.50 per share. PayPal shares surged approximately 18% to $55.83 in pre-market trading following the report, narrowing the gap between the company’s market price and the proposed acquisition value.
BTIG maintained its Neutral rating on PayPal but described the potential deal as a “lifeline worth taking.” The firm argued that the significant uncertainty surrounding the company could make the board more receptive to the proposal.
According to BTIG, acquiring the company would give Stripe an established consumer-facing platform to complement its dominant merchant payments infrastructure. The company’s portfolio includes its namesake digital wallet and Venmo, providing Stripe with immediate scale in consumer payments.
For PayPal, operating as a private company could make it easier to carry out a multiyear turnaround away from the scrutiny and short-term expectations of public markets. BTIG said the stock is currently in “no-man’s land” amid a leadership transition and questions about the company’s strategic direction.
Jefferies analyst Trevor Williams said a Stripe-PayPal combination would likely focus primarily on consumer payments rather than the merchant acquiring business. Such a strategy could bring together PayPal and Venmo with Stripe’s Link accelerated-checkout service and Button, strengthening the combined company’s position in digital wallets and online checkout.
Jefferies said the proposed transaction would likely have a neutral effect on European payments company Adyen. While Stripe would gain greater scale, Adyen’s focus on large enterprise customers could limit the competitive impact.
Jefferies maintained its Hold rating on the company. Neither PayPal, Stripe nor Advent International has confirmed that an agreement has been reached, and there is no guarantee that the reported proposal will result in a completed transaction.
