PayPal buys Swedish start-up iZettle for United States dollars 2.2 bln

PayPal buys Swedish start-up iZettle for United States dollars 2.2 bln

Digital payments giant PayPal is to swallow up Swedish financial technology start-up iZetttle for $2.2bn (£1.6bn).

PayPal is typically strong in the online arena, particularly on eBay (which used to own the company), and the deal with iZettle will strengthen its presence in bricks-and-mortar establishments, particularly in Europe.

iZettle, which is headquartered in Stockholm, is best known for offering small businesses a mini credit card reader that can turn smartphones and tablets into payment registers.

The all-cash deal is PayPal's biggest-ever acquisition following its divorce from former parent company eBay in 2015, and comes just weeks after iZettle, which now operates in 12 countries around the world, filed for an IPO as it looked to expand. The company declared that IZettle expects to generate $165 million revenue in 2018. The acquisition will expand PayPal in different countries such as France, Germany, Italy, Mexico, Brazil, Denmark, Finland, Sweden, Norway and Spain.

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iZettle was founded in 2010 by Jacob de Geer and Magnus Nilsson, and a year later they launched their first app service. "The combination of iZettle and PayPal will provide tremendous benefits to our merchants who will have access to an even wider range of tools to help them get paid, sell smarter and grow". Braintree remains a key business unit for PayPal today, serving to facilitate payments for ecommerce companies around the world.

After close of the acquisition, co-founder Jacob de Geer will remain in charge of iZettle, reporting to PayPal chief operating officer Bill Ready, according to the companies.

The deal is expected to be sealed by the third quarter of this year.

PayPal and iZettle were not immediately available for comment. 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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