PayPal Shares Plunge 15% After $53 Billion Bid Falls Apart

PayPal shares dropped sharply Friday after reports that Stripe and private-equity firm Advent International had abandoned their reported $53 billion pursuit of the payments company, reversing much of the rally that followed news of the potential takeover in July.

PayPal stock fell as much as 16% in premarket trading before trading around $53.74 shortly after Friday’s market open, compared with Thursday’s closing price of $61.47.

The shares had risen nearly 30% since reports of the potential acquisition emerged in July, pushing PayPal’s market value to about $52.6 billion. The reported offer from Stripe and Advent was $60.50 per share, valuing PayPal at more than $53 billion.

Bloomberg reported Thursday night that Stripe and Advent were no longer pursuing the transaction, citing people familiar with the matter. The report came after weeks of speculation over a possible deal for PayPal.

PayPal has faced slower growth and increasing competition from payment services including Apple Pay and Google Pay. In recent years, the company has responded with management changes, workforce reductions and cost-cutting measures aimed at improving profitability.

The potential acquisition had given PayPal shares a significant boost, but the stock has now fallen well below the reported $60.50-per-share offer. The Wall Street Journal previously reported that PayPal considered the proposal too low and that the two sides had been negotiating over the price.

PayPal’s current valuation is also far below the company’s pandemic-era peak. The company was valued at approximately $356 billion at the height of the stock market boom in 2021, compared with the roughly $53 billion valuation attached to the reported takeover offer.