PayPal Stock Surged 20 Percent After Stripe And Advent International Made A $53 Billion Joint Offer

PayPal stock jumped more than 20 percent in premarket trading Wednesday before settling around 14 to 16 percent higher after Reuters reported that Stripe and private equity firm Advent International have jointly offered $60.50 per share to acquire PayPal, a 28 percent premium over Tuesday's closing price of $47.37 and a total deal value of more than $53 billion.

The offer was submitted earlier this month and is backed by approximately $50 billion in committed bank financing.

Stripe, Advent and payments company Block are contributing $17 billion in equity. Under the proposal, Stripe and Advent would jointly own PayPal with equal stakes and run it together rather than breaking it up.

PayPal's board is expected to meet as soon as July 20 to discuss the offer. PayPal, Stripe and Advent all declined to comment.

The deal would create the world's largest merchant acquirer, combining Stripe's roughly $1.9 trillion in annual payment volume with PayPal's nearly $1.8 trillion, totaling approximately $3.7 trillion, equivalent to about 3 percent of global GDP.

Stripe, currently valued at $159 billion as a private company, would gain Venmo and PayPal's consumer payments infrastructure.

This is not Stripe's first look, it reportedly considered a bid in February and made an initial approach in April before the formal offer arrived this month.

PayPal was worth $360 billion at its 2021 peak. Wednesday's offer values it at $53 billion. That gap is the entire story of what has happened to the company since.