PayPal has agreed to acquire iZettle, a Swedish mobile payments firm which enables small businesses to process card payments, for $2.2bn (£1.6bn). The deal expands PayPal's in-store expansion opportunities in its current markets and help the company push omnichannel commerce services in Australia, the United Kingdom and the US.
IZettle, which provides mobile card readers and offers digital payment services to small businesses, is used by nearly half a million merchants. The company also offers services such as cash advances and an ecommerce offering in a bid to provide a full-fledged commerce platform for small businesses.
By joining forces with PayPal, which operates in 200 countries, iZettle will be able to accelerate its global expansion, including to the U.S., the companies said.
De Geer will continue to lead iZettle, reporting to PayPal's COO Bill Ready, and will be joined by the rest of the iZettle management team.More news: Trump Urges Senate to Confirm Gina Haspel as CIA Chief
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After the deal closes, PayPal will gain a presence in stores located in 11 new markets: Brazil, Denmark, Finland, France, Germany, Italy, Mexico, Netherlands, Norway, Spain and Sweden. "Together, we will help small businesses around the world grow and thrive in the global digital economy".
The takeover comes less than three weeks after iZettle said it would list shares in Stockholm.
However, in an interview with Bloomberg on Thursday, iZettle co-founder and chief executive Jacob de Geer said he had been convinced to instead agree a sale of the business.
"Jacob and his team bring best-in-class capabilities and talent that will expand our tremendous market opportunity". The company said it expects to reach profitability by the year 2020. The opportunity to become part of PayPal was too good to pass up. PayPal and iZettle have been in talks for years regarding a possible acquisition, but it was being delayed due to multiple reasons.