Stripe Abandons $53 Billion Bid for PayPal Amid Price Dispute

Stripe and Advent International have abandoned their bid to acquire PayPal for $53 billion. The privately held payments firm, Stripe, and the private equity house, Advent, had offered $60.50 a share, which was a 28% premium over PayPal's price at the time. However, PayPal's directors judged this offer as too low.

The attempted acquisition would have combined merchant services, consumer wallets like Venmo, cross-border transfers, and stablecoin products under one entity, making Stripe a massive player in the payments world. Just before the deal fell apart, Stripe announced another big purchase, agreeing to buy AI model marketplace OpenRouter for more than $8 billion.

PayPal's stock took a hit after the announcement, dropping about 14% to $52.77 in premarket trading on Friday. The decline has now reached as much as 16%. PayPal's market value currently sits near $52.6 billion, a recovery from roughly $36 billion earlier in the year but still a long way from its peak of roughly $360 billion that it hit in 2021.

New chief executive Enrique Lores has split the company into three divisions covering checkout, consumer financial services and Venmo, and payments and crypto. The company has also moved to cut about 20% of its staff in order to save $1.5 billion.