Irish billionaire brothers behind Stripe have teamed up with American private equity firm Advent International in a $53 billion-plus bid for PayPal, a deal that would put two of the payment platforms most relied upon by UK small businesses under the same roof.
PayPal had not responded to the bid at the time of writing, while Advent declined to comment. Stripe and PayPal did not immediately respond to requests for comment, but PayPal shares jumped 16 per cent in premarket trading on news of the approach. The offer is backed by around $50 billion in committed financing from banks.
This potential tie-up would have significant implications for the UK's small business community. Stripe powers the checkout for much of the online economy, while PayPal remains a fixture at the tills of small e-commerce businesses, sole traders, and side hustles across the UK. A combination would concentrate an enormous share of SME payment flows and the fees that go with them in far fewer hands.
Many small firms still find themselves weighing PayPal against Stripe and Square when choosing how to get paid online. A tie-up would raise questions about whether it would mean sharper pricing or less pressure to compete on fees.
Stripe was founded in 2010 by Patrick and John Collison after the siblings moved to the US, and quickly established itself as the most important payment system for the internet economy by making it easier for businesses to transact online. The company, which has dual headquarters in San Francisco and Dublin, is now valued at $159 billion.
PayPal's story stretches back further, with its history dating back to 1998 when it was set up as Confinity by Peter Thiel and two others. The company merged with rival X.com in 2000, co-founded by Elon Musk, and has since become an early pioneer of digital payments.
The business has come under sustained pressure from newer entrants, ranging from Apple and Google to buy-now-pay-later players such as Sweden's Klarna, which has been affected by the reshaping of its business through AI.
The approach also lands amid a broader wave of consolidation in payments, with other notable deals taking place in the industry. UK business owners are advised to watch the fee schedules, not the share price, as this deal continues to unfold.
