PayPal has today announced that they will be acquiring Xoom for $25 per share in cash, or $890 million, a 32 percent premium over Xoom’s three month volume-weighted average price.

Already approved by the Boards of Directors of both companies, as well as the Board of eBay Inc., PayPal’s parent company, the acquisition has been made in order to allowing PayPal to offer more services.

“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.”

Basically this will mean that PayPal will be able to expand into markets, branching out from their current focus on commercial payments as Xoom’s for business is to transfer money for friends and family remittances.

Xoom was founded by Kevin Hartz, who also co-founding Eventbrite and is still the CEO of Eventbrite, we expect he will remain that way, however as for the rest of Xoom’s current customer base and it’s employees, we are not sure what will happen, however PayPal say that “Xoom will operate as a separate service within PayPal”.

You can read more about the acquisition at the source link below.

Source: Street Insider – PayPal press release

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