This website collects cookies to deliver better user experience. Cookie Policy
Accept
Sign In
The Wall Street Publication
  • Home
  • Trending
  • U.S
  • World
  • Politics
  • Business
    • Business
    • Economy
    • Real Estate
    • Markets
    • Personal Finance
  • Tech
  • Lifestyle
    • Lifestyle
    • Style
    • Arts
  • Health
  • Sports
  • Entertainment
Reading: PayPal Abandons Pinterest Takeover After Its Shareholders Balk
Share
The Wall Street PublicationThe Wall Street Publication
Font ResizerAa
Search
  • Home
  • Trending
  • U.S
  • World
  • Politics
  • Business
    • Business
    • Economy
    • Real Estate
    • Markets
    • Personal Finance
  • Tech
  • Lifestyle
    • Lifestyle
    • Style
    • Arts
  • Health
  • Sports
  • Entertainment
Have an existing account? Sign In
Follow US
© 2024 The Wall Street Publication. All Rights Reserved.
The Wall Street Publication > Blog > Markets > PayPal Abandons Pinterest Takeover After Its Shareholders Balk
Markets

PayPal Abandons Pinterest Takeover After Its Shareholders Balk

Editorial Board Published October 25, 2021
Share
PayPal Abandons Pinterest Takeover After Its Shareholders Balk
SHARE

PayPal said in a statement late Sunday that it was “not pursuing an acquisition of Pinterest at this time.” The deal, talks for which leaked last week, would have combined a payments giant with broad financial ambitions and an image-sharing site that has struggled to fully capture the benefits of its role in e-commerce.

Contents
Newsletter Sign-upMarkets

Newsletter Sign-up

Markets

A pre-markets primer packed with news, trends and ideas. Plus, up-to-the-minute market data.


PayPal shares fell almost 12% in three days after the possible deal surfaced, a sign that investors doubted its wisdom. They closed up 2.7% Monday. Pinterest shares plunged about 13% after initially surging last week.

A deal for Pinterest, with a market capitalization of more than $37 billion, would have been one of the biggest mergers of the year and PayPal’s largest ever.

PayPal’s board and management decided Sunday to back away after determining the decline in the shares, along with other issues in the early-stage talks, would make coming to an agreement unlikely, people familiar with the matter said. With a lower share price, PayPal may have had to hand a larger portion of ownership to Pinterest investors in a stock deal, something that would further frustrate its own shareholders.

Because a deal had not yet been reached, PayPal was in the awkward position of not being able to explain its rationale for the acquisition to shareholders. The company saw Pinterest as a unique opportunity to connect with customers sooner in the shopping process, the people said.

PayPal has been trying to turn itself from a payments company to a gateway to digital commerce. It is trying to expand beyond its roots as an online-checkout option and become more of a service that helps users find new items online that they might like to buy. Buying Pinterest—a platform that lets users swap recipes and home-decor ideas—would have connected PayPal with consumers as they are considering what to buy. But investors aren’t convinced that PayPal would be able to make money off Pinterest’s 454 million monthly active users, analysts said.

“The concern is that you have a bunch of people that surf around the web looking for a couch for their new home. They might pin it, but it’s not that big of a deal. They might never buy it,” said Darrin Peller, managing director at Wolfe Research LLC.

Pinterest gets most of its revenue serving users ads, rather than connecting them to retailers and taking a cut of their shopping dollars.

Investors are also concerned that acquiring Pinterest would alienate key PayPal partners including online merchants and the social-media platforms that use it to process transactions, said Chris Donat, senior research analyst at Piper Sandler.

PayPal was once part of eBay Inc. The payments company has grown rapidly since its 2015 divorce from the online marketplace, in part because of its partnerships with payments processors including Visa and Mastercard, regional banks and merchants.

PayPal “needs the degrees of freedom that come with being independent,” Mr. Donat said.

PayPal wants to roughly double its active users to 750 million over five years, Chief Executive Dan Schulman said during an investor-day presentation earlier this year. To get there, the nearly 23-year-old company is working on an array of tools designed to attract and monetize users, including bill payments and crypto. Another key to the company’s growth goal is bringing users to PayPal sooner in their shopping experience. That could increase payment volume, and PayPal would be able to charge merchants for access to their growing customer bases.

The potential Pinterest deal’s fast undoing was reminiscent of Salesforce Inc.’s abandoned takeover pursuit of Twitter Inc. in 2016. Both were deals proposed by tech royalty for buzzy, beloved-but-less-profitable platforms. Salesforce stock fell when the deal talks leaked and CEO Marc Benioff was forced to abandon the idea.

PayPal’s record as an acquirer may also have given investors some reason for skepticism. Venmo, the payment app with millions of young users that PayPal acquired in 2013, still hasn’t turned a profit for its parent company.

—Ben Otto contributed to this article.

Write to Orla McCaffrey at orla.mccaffrey@wsj.com and Cara Lombardo at cara.lombardo@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

TAGGED:MarketsPAIDWall Street Publication
Share This Article
Twitter Email Copy Link Print
Previous Article Joe Biden caught with his rusty drawbridges down Joe Biden caught with his rusty drawbridges down
Next Article Mastercard Partners With Bakkt to Bring Cryptocurrency Payments to the Masses Mastercard Partners With Bakkt to Bring Cryptocurrency Payments to the Masses

Editor's Pick

JPMorgan unveils its 2025 summer season studying record

JPMorgan unveils its 2025 summer season studying record

JPMorgan Chase Chairman and CEO Jamie Dimon on the significance of management abilities, deregulation coverage, power independence and the Federal…

By Editorial Board 4 Min Read
Overview: Hollywood star delivers an enormous shock at BottleRock Napa
Overview: Hollywood star delivers an enormous shock at BottleRock Napa

Followers turned out to see Kate Hudson at BottleRock Napa Valley on…

5 Min Read
Man shot and killed on one hundredth Avenue in Oakland on Saturday
Man shot and killed on one hundredth Avenue in Oakland on Saturday

Oakland police are investigating the loss of life of a person, 34,…

1 Min Read

Oponion

Ray Dalio’s Bridgewater Raises .25 Billion for Its Largest China Fund Yet

Ray Dalio’s Bridgewater Raises $1.25 Billion for Its Largest China Fund Yet

Bridgewater Associates LP has raised the equivalent of $1.25 billion…

November 24, 2021

The Greatest Deodorant For Males Who Need To Odor Good | Fashion

We independently consider all really helpful…

April 29, 2025

Bichette seems to be to bounce again after tough season

DUNEDIN – Blue Jays shortstop Bo…

February 21, 2025

Kurtenbach: Because the NHL commerce deadline looms, a seismic shift is underway for the Sharks

Sharks common supervisor Mike Grier is…

March 5, 2025

Companies Bet You’re Ready to Test at Home for More Than Covid-19

The Covid-19 pandemic has hastened consumers’…

March 3, 2022

You Might Also Like

Elon Musk’s return drives Tesla inventory surge in Might
Markets

Elon Musk’s return drives Tesla inventory surge in Might

As President Donald Trump thanked Elon Musk for his service to DOGE, he additionally highlighted what he described as his…

5 Min Read
EV tax credit score elimination: What it may imply for Tesla and the US auto trade if it ends
Markets

EV tax credit score elimination: What it may imply for Tesla and the US auto trade if it ends

Automotive knowledgeable Lauren Repair mentioned discusses the affect that the One Huge Lovely Invoice Act may have on Tesla. The…

5 Min Read
Boeing paying .1B as DOJ dismisses prison fraud case; households of victims in crashes set to object to deal
Markets

Boeing paying $1.1B as DOJ dismisses prison fraud case; households of victims in crashes set to object to deal

President Donald Trump chosen the aerospace large to construct the Subsequent-Era Air Dominance Platform, which he mentioned would be the…

5 Min Read
GM CEO backs Trump’s auto tariffs as a device to assist US producers
Markets

GM CEO backs Trump’s auto tariffs as a device to assist US producers

Basic Motors Chair and CEO Mary Barra discusses the impact of auto tariffs and constructing the enterprise on 'The Claman…

5 Min Read
The Wall Street Publication

About Us

The Wall Street Publication, a distinguished part of the Enspirers News Group, stands as a beacon of excellence in journalism. Committed to delivering unfiltered global news, we pride ourselves on our trusted coverage of Politics, Business, Technology, and more.

Company

  • About Us
  • Newsroom Policies & Standards
  • Diversity & Inclusion
  • Careers
  • Media & Community Relations
  • WP Creative Group
  • Accessibility Statement

Contact

  • Contact Us
  • Contact Customer Care
  • Advertise
  • Licensing & Syndication
  • Request a Correction
  • Contact the Newsroom
  • Send a News Tip
  • Report a Vulnerability

Term of Use

  • Digital Products Terms of Sale
  • Terms of Service
  • Privacy Policy
  • Cookie Settings
  • Submissions & Discussion Policy
  • RSS Terms of Service
  • Ad Choices

© 2024 The Wall Street Publication. All Rights Reserved.

Welcome Back!

Sign in to your account

Lost your password?