EBay set to acquire Braintree to boost mobile innovation
Online commerce giant EBay is set to acquire payment platform Braintree for about $800 million in cash in order to strengthen its PayPal business, especially its mobile presence.
PayPal enables global commerce, processing more than 7.7 million payments every day. According to analysts, PayPal, with its 120 million users, has dominated online payment services for about a decade. But its growth has moderated in recent years, owing to increased competition by smaller providers on mobile space, in a recent interview, EBay’s vice president of global product, Hill Ferguson mentions.
The deal gives Ebay access to Braintree’s Venmo, an app that lets consumers make payments on smartphones and tablets, an area in which the company wants to concentrate now. The app lets people pay each other using their mobile devices, similar to a service PayPal offers.
In March this year, PayPal bought mobile app developer Duff Research to boost mobile innovation.
Braintree, that has over 180 employees, help online and mobile businesses around the world accept credit card payments by providing a merchant account, payment gateway, recurring billing and credit card storage.
According to a company statement, Braintree will continue to operate as a separate service within PayPal under the leadership of Braintree CEO Bill Ready, who will report to PayPal President David Marcus.
“Braintree will continue to do what it’s currently doing,” said Marcus in a statement, stating that PayPal will help the company grow and expand internationally.
EBay said it expects to close the deal before the end of the year.
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