The digital payments firm PayPal is buying iZettle, one of Europe’s best known financial technology startups that sells mobile credit card readers and other payment platforms, for $2.2 Bn in company’s biggest deal so far.
The deal is in line with PayPal’s strategy for further expansion into the physical payments market and provides an increased foothold in the European proximity payments segment. The deal is expected to close in the third quarter of 2018 and will help PayPal provide a more comprehensive suite of services to its merchants. iZettle’s presence will allow PayPal to bring its platform to nearly 500,000 stores in 11 new countries, including France, Germany, Brazil, and Mexico, and also expand offline in the United States, United Kingdom and Australia.
Founded in 2010 and based in Sweden, iZettle provides mobile-phone gadget for accepting credit card payments and offers software and lending services to support small businesses. The company operates in 12 markets in Europe and Latin America and was valued at about $500 M in January 2017. iZettle expects to process $6 Bn in payments in 2018 and have gross revenues of $165 M.
PayPal operates in 200 countries and since separating from online marketplace eBay in 2015, has reshaped itself from mostly processing online transactions for its parent company to offering a suite of digital payment services across the world from lending to small businesses, to facilitating money transfers.
Previous plans of iZettle announced on May 8 sought to raise 2 Bn kronor ($226.6 M) in an initial public offering to be completed this year. PayPal’s acquisition comes after eBay announced in February that it would no longer use PayPal as its main payment processing partner, opting to link up with Dutch rival Adyen instead.
PayPal Buys Swedish Mobile Payments Startup iZettle for $2.2 Bn
