PayPal returns to market with $52 billion valuation
By Devika Krishna Kumar and Mari Saito
(Reuters) - PayPal Holdings Inc (PYPL.O: Quote) shares jumped as much as 11 percent in their highly anticipated return to the Nasdaq after more than a decade in eBay Inc's (EBAY.O: Quote) fold, valuing the digital payment processor at about $52 billion.
PayPal is a giant in the market it helped create - it processed 4 billion payments tootling about $235 billion in 2014. But the online payments landscape has changed drastically since the company was snapped up by eBay in 2002.
Freed from eBay, PayPal is now expected to partner with other e-commerce sites and try to seize market share from startups such as Stripe and Square and Apple Inc (AAPL.O: Quote), which unveiled its own mobile payments service last year.
For eBay, the separation allows the company to focus on its struggling e-commerce marketplace.
PayPal shares soared to $42.55 in early trading. EBay's stock fell as much as 4.7 percent, valuing the company at about $32 billion.
"PayPal is the gorilla among independent digital payment service providers with more than 160 million active accounts, global scale and brand recognition," J.P. Morgan analysts said.
PayPal is also looking to compete with Western Union Co (WU.N: Quote) and other money transfer companies. CEO Dan Shulman said he was looking to use PayPal's size to offer affordable financial services widely.
"It's clear that the potential for mobile technology to transform money extends beyond commerce. The vast majority of the world's 7 billion people lack access to even basic financial services," Schulman told Reuters. Continued...