PayPal buys Swedish startup iZettle for $2.2bn

Olive Hawkins
May 18, 2018

PayPal is shelling out $2.2 billion for the deal and it is going to be an all-cash transaction. Today, small-business owners around the world use iZettle's powerfully simple services to improve the speed and ease of payments at checkout, business management, sales analytics, customer engagement, and funding. "iZettle and PayPal are a strategic fit, with a shared mission, values and culture-and complementary product offerings and geographies".

The chip-card reader and its app for smartphone-based mobile commerce meet worldwide security standards. iZettle's service is available in 12 countries which includes United Kingdom, Finland, Denmark, Germany, Italy, Netherlands, Spain, Italy, Germany, and Brazil, among others.

"Small businesses increasingly want a full suite of capabilities across channels, a one-stop stop", Dan Schulman, chief executive officer of PayPal, said in an interview.

iZettle was founded in 2010 by Jacob de Geer and Magnus Nilsson, and a year later they launched their first app service.

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At close, PayPal will get in-store capabilities in 11 markets, including Brazil, Denmark, Finland, France, Germany, Italy, Mexico, the Netherlands, Norway, Spain and Sweden.

By joining forces with PayPal, which operates in 200 countries, iZettle will be able to accelerate its global expansion, including to the US, the companies said. The company forecast reaching EBITDA profitability by 2020 on a standalone basis.

PayPal said it hopes to be able to reap the advantages of the merger nearly immediately in certain areas, and that the financial benefits will kick in shortly after the deal closes, expected in the third quarter.

PayPal, based in San Jose, California, says Stockholm-based iZettle is on pace to process about $6 billion in payments this year. 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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