Stripe and Advent Want to Buy PayPal: A Super Simple Guide

Image credit: Samuel Boivin | Nurphoto | Getty Images

What’s Happening?

Imagine your friend has a lemonade stand called PayPal. Now two bigger companies, Stripe and Advent International, walk up and say: “We want to buy your whole stand!” That’s basically the news.

• Stripe is a payments company – it helps businesses take money from customers online.
• Advent International is a private equity firm (a kind of money club that buys other companies).
• They made a joint offer (a team proposal) to acquire (buy) PayPal Holdings Inc.
• They offered $60.50 for every tiny ownership piece (called a “share”) of PayPal.
• If they buy, PayPal would be valued at more than $53 billion in total.

Important: This story comes from two people who know about the secret talks but didn’t want their names shared. The companies haven’t officially confirmed it with big public announcements yet.

When Did This Offer Appear?

• The offer was sent earlier this month.
• It followed an early “hello, want to sell?” approach made in early April.
• Right now, PayPal hasn’t replied. Stripe and Advent hope to talk more in the coming weeks.

How Much Money Is Involved?

The grown‑up numbers, explained simply:

• The offer is backed by about $50 billion in committed financing from banks. That means banks promised to lend the money needed to buy PayPal.
• The $60.50 per share is about 28% higher than PayPal’s closing share price on Tuesday. That extra bump is called a premium – like paying a little extra for a toy because you really want it.

Who Said What?

• The people who shared the news stayed unnamed because the discussions are private.
• Advent said “no comment” (they stayed quiet).
• PayPal and Stripe didn’t quickly answer when a news agency (Reuters) asked them.

What Would Happen If They Buy PayPal?

Under the proposal, here’s the plan in numbered steps:

1. Stripe and Advent would own PayPal together (jointly).
2. Each would hold an equal stake – think 50%‑50%, like two kids owning one bike together.
3. They would not break up the company; they’d keep it as one whole business.
4. There is no certainty the deal will actually happen – it might still fall apart.

Why Is PayPal a Target?

PayPal started in the late 1990s. It was an early pioneer in digital payments (paying with magic internet money). But lately:

• Competition grew: people now use Apple Pay, Google Pay, and other methods.
• After the pandemic (when online shopping boomed), growth slowed.
• Much of the value gained during that boom has disappeared.

PayPal’s Value Drop in Bullet Points

• Peak total value (market capitalization) was about $360 billion in 2021.
• This year it fell as low as roughly $36 billion.
• Over the past 12 months, it lost more than 40% of its total value.

What Is PayPal Doing to Get Better?

After Enrique Lores became CEO (top boss) in March, he started a big cleanup to simplify the company and focus on growth.

In April, PayPal split its work into three units:

1. Checkout – the part that lets you pay at stores or websites.
2. Consumer financial services (Venmo) – the app for sending money to friends.
3. Payments and crypto – handling digital coins and other payment tech.

They also made several management changes (new leaders in charge).

Callout for Important Points

Key Things to Remember:

• Stripe + Advent offered $60.50 per share for PayPal (total ~$53 billion).
• About $50 billion in bank money backs the offer; price is 28% above recent level.
• They’d co‑own PayPal equally and keep it intact.
• PayPal faces tough competition and has lost lots of value since 2021.
• New CEO is reshaping the company into three parts.
• The deal is not guaranteed and talks are confidential.

Summary

Two big money players, Stripe and Advent, want to buy PayPal for a hefty price-tag of over $53 billion, with banks ready to supply $50 billion. PayPal has been struggling because rivals like Apple Pay stole some spotlight and its value dropped from a 2021 high. A new boss is tidying up the company by splitting it into three smaller teams. The purchase might happen or might not, but it’s a major event in the world of online payments.

FAQ

Q1: What is a “share” in kid words?
A share is a tiny slice of a company. If a company has 100 slices and you own 1, you own 1% of it. The offer wants to buy each PayPal slice for $60.50.

Q2: What is a “private equity firm”?
It’s like a club that gathers money from wealthy investors and uses it to buy other companies, hoping to improve them and make profit.

Q3: Why pay 28% more than the normal price?
That extra is called a premium. When you want to buy a whole company, you usually pay a bit above the current price to convince owners to sell – like offering $1.28 for a $1 candy because you want the whole bag.

Q4: Will PayPal disappear if bought?
No. The plan says Stripe and Advent would keep PayPal as one company, just owned by them together. You’d likely still use PayPal, maybe with future changes.

Q5: Why did PayPal lose so much value?
Because after the pandemic online shopping slowed, competitors like Apple Pay grew popular, and the whole tech market cooled, wiping out much of its peak worth.