PayPal, Braintree Reach $800 Million Purchase Agreement (Sept. 26, 2013)
It’s official; eBay Inc. has announced it will acquire e-commerce processor Braintree Payment Solutions in an $800 million deal that will bring Chicago-based Braintree under eBay’s PayPal business unit. The two companies were reported to be in negotiations for a sale earlier this week. With the purchase agreement in place, PayPal gains Braintree’s more than $10 billion in annual payment processing volume, along with a client list that includes hot startups like Uber Technologies, Rovio, OpenTable and Airbnb.
“Braintree is a perfect fit with PayPal,” said eBay Inc. President and CEO John Donahoe, who said he expects the deal to “accelerate our leadership in supporting developers, who are creating innovative solutions for next-generation commerce startups.” Upon finalization of the acquisition, expected late this year, Braintree will continue to operate as a separate service within PayPal. Braintree CEO Bill Ready will remain at the helm, reporting to PayPal President David Marcus.
The purchase also gives PayPal control of Venmo, a mobile P2P payment service acquired by Braintree in July for $26 million, which will bolster PayPal’s mobile payment processing business—already projected to process more than $20 billion in payment volume this year.
Founded in 2007, Braintree has focused on providing payment processing for startups and niche e-commerce firms. Braintree has raised more than $70 million in funding and operates in more than 30 countries. The company’s transaction volume grew 25 percent in four months earlier this year, in large part because of international transactions, which now account for more than a quarter of its payments.
