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PayPal (NASDAQ: PYPL) stock collapsed 14.67% in pre-market trading on Friday, August 28, after reports emerged that Stripe and Advent had withdrawn their offer to acquire the company for $60.50 per share.

The decline followed a period of gains for the stock, which had climbed 5.40% over the previous 30 days of trading to close at $61.47. Shares remained level during the after-hours session on Thursday but dropped sharply as soon as pre-market trading began on Friday, falling to $52.45.

The pre-market move erased a significant portion of PayPal's market capitalization, which fell from $52.58 billion to $44.87 billion as a result of the price drop.

Key details

PYPL closed at $61.47 after a 5.40% gain over 30 days
Shares fell 14.67% to $52.45 in pre-market trading
Market capitalization dropped from $52.58 billion to $44.87 billion
The proposed acquisition offer from Stripe and Advent was priced at $60.50 per share

The sharp downward move in PayPal's stock price was entirely attributed to the reports of Stripe and Advent's withdrawal from the acquisition offer.

Source

1b:T4d4,

PayPal's board is reported to consider inadequate a joint takeover bid from payments company Stripe and private equity firm Advent International, which offered $60.50 a share for the company, valuing it at more than $53bn.

According to Reuters, which cited people familiar with the matter, Stripe and Advent International made the joint approach to acquire PayPal. The offer was reported on 15 July and carries roughly $50bn of committed bank financing from J.P. Morgan.

Payments specialists who commented on the proposed deal were largely drawn to what a combined business could build together. However, each of them pointed to the same obstacle: the integration challenge posed by merging two large, complex payments organizations, rather than any concern about the underlying technology.

PayPal's board has not disclosed further details on its rejection or on any counter-terms it may seek. No timeline for further negotiations or a revised offer has been reported.

For more details, see the original report at The Fintech Times.

#PayPal