PayPal snaps up iZettle in $2.2bn deal

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PayPal is swooping for Swedish payments start-up iZettle in a $2.2bn (£1.6bn) all-cash deal, as it seeks to create a "one-stop shop" for transactions.

The acquisition - PayPal's largest ever - will expand PayPal's in-store presence, enabling it to reach small businesses around the world through its merchant services offering. iZettle will become the European centre of excellence for PayPal's in-store product and services offerings. PayPal also gains near-term in-store expansion opportunities into other existing PayPal markets, and acceleration of omnichannel commerce solutions in Australia, U.K. and U.S.

iZettle CEO Jacob de Greer and the company's management team will continue to lead the business, which expects to process $6 billion in payments in 2018 and have gross revenues of $165m.

The companies said on Thursday, May 17, 2018, that the deal will strengthen their platform to help millions of small businesses around the world grow and thrive in an omni-channel retail environment.

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The deal is going to add value to PayPal and help them expand to new markets, a sentiment Dan echoed in his statement, "Jacob and his team bring best-in-class capabilities and talent that will expand our tremendous market opportunity".

"We believe that the listing will support our continued growth, our strategy and provide us with improved access to capital markets", CEO Jacob de Geer told CNBC at the time.

Nasdaq-listed PayPal is a giant in the sector, disclosing in first quarter results last month that it processed $49bn (£36.3bn) in mobile payments during the three months to 31 March. The two companies will continue to operate independently until close. IZettle does not now face too much direct competition from its main rival, the NASDAQ-listed Square, as the companies' operations only really overlap in the UK. J.P. Morgan Securities plc is acting as sole financial adviser to iZettle, while Gernandt & Danielsson is acting as its legal adviser.