The most popular online retailer – Ebay Inc will buy the payment-gateway startup, Braintree (braintreepayments.com) for $800 million in cash to add the feature to it’s PayPal business.
This move by the company could also be termed as buying out the competitor to PayPal’s existence and experts opinionated that the acquisition makes PayPal even stronger by utilizing it’s payment features on PayPal, but Ebay said that Braintree will work as the independent payment gateway with it’s existing 40+ merchants and even with it’s 180 plus employees and Bill Ready, the CEO of Braintree should report to the PayPal.
Bill Ready said in the statement to it’s users and partners:
“Our current customers and developer community can expect the same level of support and partnership they’ve always enjoyed, coupled with more resources.”
Braintree currently processes online and mobile credit card payments by providing a merchant account, payment gateway, billing and credit card storage. Although PayPal has contributed 40% of revenue to the Ebay’s total revenue in 2012, this acquisition makes it even better. By the way, Ebay has acquired PayPal on 2002 to facilitate the online transaction without credit cards. Ebay’s shares closed at $54.21 on the Nasdaq on Wednesday, and currently up by about 2 percent at $55.82 following the announcement.