PayPal prepared to spend $45 billion to acquire Pinterest

PayPal may soon make a foray into social media and image sharing, as the San Jose-based company makes a move to purchase the internet's most popular digital pinboard company.

The company plan is to finance the acquisition by paying roughly $70 per share, a 26% premium on Pinterest's closing price on Tuesday. The deal would cost PayPal $45 billion.

News of the acquisition caused Pinterest's stock prices to jump over 13% earlier, forcing trading to be halted temporarily, according to Reuters

PayPal's shares were down 3.5% on Wednesday, though the company has seen exceptional growth since the start of the pandemic. In the last twelve months, PayPal's shares have increased in value by 36 percent.

PayPal also owns popular online payment service Venmo, and popular online coupon extension Honey.

In March, it was reported that PayPal would allow users to use their cryptocurrency holdings on the platform for payments at millions of its merchants across the globe. Customers can also purchase Bitcoin, Etherium, and Litecoin from PayPal.

5 Comments

hackintoisier 86 comments · 5 Years

About 3 years ago

If Pinterest is $45B, how is Arm only $40B?

22july2013 3722 comments · 11 Years

Occasionally a Google web search sends me to a Pinterest page, and the moment it appears, I always immediately back out of it. That's because Pinterest's interface reminds me of 1990's malware. And it demands an email address before it lets me scroll down the page. However I notice that macOS Monterey's iCloud+ new "Hide My Email" feature says it will work with Pinterest. So I just tried it. And Pinterest's website let me create the account but it never sent me a confirmation email, so I still can't use their site, even with iCloud+. I presume either Pinterest rejects all iCloud email addresses or they have some sort of filter that allows them to detect whether I'm using one of iCloud+'s temporary email addresses.

goodbyeranch 249 comments · 9 Years

The stories in 2023 write themselves. Ebay/Paypal. AOL/TimeWarner, Google/Motorola. eBay/skype, Yahoo and Anything

swat671 156 comments · 9 Years

But why? I don’t see the “synergy” there.

Marvin 15335 comments · 18 Years

swat671 said:

But why? I don’t see the “synergy” there.

PInterest is described as social commerce where people are building up wishlists for items to buy based on social recommendations. They have a lot of users, global monthly actives are 478 million:

https://investor.pinterestinc.com/press-releases/press-releases-details/2021/Pinterest-Announces-First-Quarter-2021-Results/default.aspx

It seems they make most of the money just now based on ads for promoted items. If Paypal can figure out how to get those purchases through the Paypal system then they can make a cut that way but they will make money from the ads too.

One suggestion was about changing the way people shop online to move away from a shopping cart per site. If someone had a wishlist of items from multiple different sites (Pinterest is used for clothes and shoes), there could perhaps be a unified checkout directly on Pinterest to buy the items from different vendors with a single checkout.

I think clothing vendors would probably like this kind of setup (especially small stores that would struggle to get signups or maintain websites) and it allows buyers to create and purchase entire outfits together from different places. This might have been done elsewhere already but Pinterest has a much bigger scale.

The valuation seems huge but it always is when there are so many active users. They are buying access to an audience and valuing each user here at around $100.

https://www.statista.com/statistics/234056/facebooks-average-advertising-revenue-per-user/