PayPal, Inc. and digital money transfer provider Xoom entered into a definitive agreement under which PayPay will acquire Xoom for $890 million. The transaction represents a premium of 32% over Zoom’s three-month volume-weighted average price. The transaction was also approved by the Boards of Directors of both companies along with the Board of eBay Inc., the parent company of PayPal.
“Expanding into international money transfer and remittances aligns with our strategic vision to democratize the movement and management of money. Acquiring Xoom allows PayPal to offer a broader range of services to our global customer base, increase customer engagement and enter an important and growing adjacent marketplace. Xoom’s presence in 37 countries – in particular, Mexico, India, the Philippines, China and Brazil – will help us accelerate our expansion in these important markets,” shared PayPal President Dan Schulman in a press released.
Xoom will operate as a separate service within PayPal upon closing of the acquisition. The acquisition is expected to close in the fourth quarter of 2015. This will be subject to customary closing conditions including Xoom stockholder approval, the expiration or early termination of the applicable pre-merger waiting period, and the receipt of certain consents relating to Xoom’s money transmitter licenses.