PayPal agrees $2.2bn deal for Swedish payments firm iZettle

Pat Wise
May 18, 2018

With the agreement, PayPay gains access to almost 500,000 small businesses that use iZettle's technology to process customer transactions involving credit cards. "iZettle and PayPal are a strategic fit, with a shared mission, values and culture-and complementary product offerings and geographies".

The Swedish firm is best known for its portable point of sale (POS) readers, which can plug into a smartphone or tablet to allow businesses of any size to quickly and easily begin accepting card or contactless payments.

After the deal closes, PayPal will gain a presence in stores located in 11 new markets: Brazil, Denmark, Finland, France, Germany, Italy, Mexico, Netherlands, Norway, Spain and Sweden.

It was unclear on Thursday night whether Mr de Geer and his senior colleagues would remain with the business if a takeover by PayPal does go ahead, although sources indicated that they would be likely to.

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By joining forces with PayPal, which operates in 200 countries, iZettle will be able to accelerate its global expansion, including to the USA, the companies said. "The combination of iZettle and PayPal will provide tremendous benefits to our merchants who will have access to an even wider range of tools to help them get paid, sell smarter and grow". The company said it expects to reach profitability by the year 2020.

The transaction, which is expected to be United States dollars 0.01 dilutive to PayPal full year adjusted earnings per share, is subject to the usual closing conditions, including regulatory approvals.

Nasdaq-listed PayPal, which was previously part of the same company as the online auction site eBay, is a giant in the sector, disclosing in its first-quarter results last month that it processed $49bn in mobile payments during the three months to 31 March. J.P. Morgan Securities plc is acting as sole financial adviser to iZettle, while Gernandt & Danielsson is acting as its legal adviser.

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