Payments giant PayPal makes $45 billion takeover bid for Pinterest

Payments giant PayPal makes $45 billion takeover bid for Pinterest

by Pranali Mehta

PayPal Holdings Inc, an American multinational financial technology company, has reportedly made a $45 billion takeover bid for the digital pinboard site Pinterest Inc. According to sources privy to the matter, the combination may pave the way for future e-commerce collaborations between social media and financial technology firms.

The transaction discussions, which came to light  disclosed Wednesday, come as online consumers are becoming increasingly inclined to buy things they see on social media, frequently following "influencers" on sites like TikTok and Instagram.

Acquiring Pinterest would allow PayPal to take a larger share of the e-commerce boom while diversifying its revenues through advertising revenue.

According to one of the sources, PayPal has proposed $70 per share, in stock primarily, for Pinterest. The source stated that the online payments service aims to successfully negotiate and reveal an agreement by November 8, 2021, when it announces its quarterly profits.

Reliable sources have underlined that no agreement has been made as of yet was guaranteed and that terms of the deal might change.

PayPal's bid marks a 26% premium over Pinterest's Tuesday (19th Oct) closing price of $55.58. PayPal's stock dropped more than 4% in response to the takeover speculations, while Pinterest's stock soared over 14% to $63.51 per share.

In a note, Wedbush analysts stated that the merger would be a big benefit for PayPal's existing monetization ambitions on both ends of its consumer and merchant platforms, primarily if Pinterest's social commerce service is merged with Honey's AI into PayPal's destination application.

The payments giant was one of the main beneficiaries of the pandemic, as more individuals started using its services to avoid going out pay bills and use hard currency. The company’s shares have gone up roughly 36% over the last year, giving it a market capitalization of about $320 billion.

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Pranali Mehta

A chemical engineer by qualification, Pranali Mehta dutifully walked down the slated path and worked in a chemical firm for a year. Her passion for writing however, pushed her into experimenting with the same as a career. With over three years of experience in content writ Read more...