Payment processing firm Stripe is considering an acquisition of all or parts of PayPal Holdings, according to people familiar with the matter.
Stripe, which is closely held and is among the industry's most valuable companies, has expressed preliminary interest in a potential acquisition of the digital payments pioneer or its assets, the people said, asking not to be identified because the matter is private.
The deliberations are early and there's no certainty they'll lead to a transaction, the people said. Representatives for Stripe and PayPal declined to comment.
PayPal rose 6.7% to $47.02 in New York Tuesday, giving it a market value of $43.3 billion.
Founded in the late 1990s, PayPal was an early mover in digital payments. It has since struggled with modernizing its payment technologies as rivals such as Apple and Alphabet have seized market share.
Stripe, founded by brothers Patrick and John Collison, has become one of the industry's most coveted players. Earlier Tuesday, Stripe announced it had reached a $159 billion valuation in an employee tender offer.
"PayPal has had, obviously, a tough time over the past few years and the landscape has changed quite a bit with Apple Pay and Google Pay and everything like that," Collison, Stripe's president, said in an interview this week. "I can't talk about any, you know, M&A hypotheticals but they've definitely had a tough time."
PayPal's former board chair, Enrique Lores, is due to take up his new role as president and chief executive officer on March 1, replacing Alex Chriss, who was ousted as CEO this month. David Dorman was appointed to replace Lores as board chair.
Chriss's taking of the reins from Dan Schulman in 2023 had been seen at the time as a much-needed shift. How consumers and businesses handle payments had changed enormously since PayPal was conceived.
The company's fourth-quarter profit and revenue missed analysts' estimates,
