News :: Go Back ::
EBay Pays Up for PayPal
EBay announced today that it will acquire Internet payment service vendor PayPal for about $1.5 billion.
The move -- the reverse of outsourcing -- represents the vertical integration of a service already used in 40% of EBay transactions. Analyists claim the deal with increase EBay's take on transactions in which PayPal is used from 7% to 10% of their value.
In the stock transaction, 0.39 of each EBay share will be traded for one PayPal share, about a 15% premium over PayPal's closing price on Friday. The payment company, having gone public only last February, had been trading at about $20 per share after hitting a high of about $30 in late May. While rapidly growing, it has never generated a profit.
:: Go Back ::