Stripe wants to buy PayPal for $53B after it lost 90% of its value
Remember when PayPal was the undisputed king of online money? Well, times change fast, and now its slicker rival Stripe is teaming up with private equity to buy the legacy giant for what looks like a massive discount.
The joint takeover bid from Stripe and Advent International landed on PayPal's desk with a $60.50 per share offer, backed by a massive $50 billion in guaranteed bank financing. First sent back in April, the proposal has been sitting in limbo, waiting for a formal response from the tech veteran.
Back in 2021, PayPal was a financial titan boasting a $360 billion market cap, but a brutal combination of fierce competition from Apple Pay and Google Pay, alongside smaller nimble startups, triggered a tenfold collapse in its valuation to just $36 billion.
To patch the bleeding, newly appointed CEO Enrique Lores recently restructured the company into three distinct units, including the struggling millennial favorite Venmo. While Q1 revenue did beat expectations at $8.35 billion, the company is now desperately banking on using AI to slash redundant corporate jobs in hopes of saving $1.5 billion over the next few years.
It is the ultimate corporate tragedy: the pioneer that literally taught the world how to pay online is now being eyed as a cheap salvage project by the very competitors it once looked down upon. Watching a former $360 billion giant get priced like a fixer-upper home shows that in tech, absolute dominance is just a temporary state of grace.
Source: Reuters
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