Online-payments giant PayPal Holdings on Thursday confirmed the completion of its buyout of Swedish mobile payments start-up iZettle for $2.2 billion, the biggest acquisition in the company’s history.
The deal boosts PayPal’s in-store presence in 11 markets across Europe and Latin America. It also makes strategic sense for the company as it helps deepen its footprint in Europe and gain more of a presence in offline commerce at a time when competition in the sector is increasing.
As such, the merger would catapult the company into hundreds of thousands of brick-and-mortar storefronts globally.
PayPal is also competing with its rival Square on more fronts, including digital payments tool into physical retailers. Square Inc., a payments company founded and run by Twitter CEO Jack Dorsey, was awarded last month a coveted license to deal in cryptocurrencies in New York.
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US-based PayPal is also facing increased competition as more companies, including Apple and Samsung, improve their payment offerings.
Founded in Stockholm in 2010, IZettle got its start selling credit and debit card readers to small businesses in Europe that could be plugged into smartphones and tablets. The company also offers point-of-sale systems, invoicing software and business loans, but it is most known for its mobile card readers.
PayPal also could help accelerate iZettle’s international expansion plans as the company announced it would list shares in Stockholm.
Jacob de Geer, co-founder of iZettle, will maintain his position as the current CEO and the firm will operate as a separate service within PayPal Group.
While PayPal didn’t clarify specifics on integration plans, the company said in the official statement: “We’re thrilled to welcome the iZettle team to the PayPal family and are excited to expand the ways we serve our small business customers. iZettle brings a suite of products and services that allows merchants to meet their customers where they are – online, in-store or via mobile. This is another step in our journey toward democratizing commerce tools to help businesses of all sizes thrive.”