PayPal’s board considers an acquisition bid by Stripe and Advent to undervalue the company, according to reporting by Reuters.

On 15 July, the Financial Times reported that Stripe and Advent had partnered to acquire PayPal for $60.50 a share, valuing the company at around $53 billion. This represented a 28 per cent premium on the company’s share price at the time reports were first published.

A person familiar with the matter told Reuters that the PayPal board is evaluating the bid but thinks it is low and would run into regulatory difficulties.

The same person told Reuters that the board is weighing the Stripe and Advent’s offer against the potential other bids, as well as the likelihood of its growth plan paying off in coming years.

PayPal’s new president and chief executive Enrique Lores, who stepped into the role in February, has vowed to turn the firm around after displeasure among its board over the pace of improvements in recent years.

“We operate in a highly competitive, fast-moving environment,” Lores said, in a LinkedIn post marking his first day as chief executive. “Winning requires clear priorities, disciplined execution, and innovation that consistently improves customer experiences at scale.​ PayPal has a vital role to play for millions of consumers and merchants around the world.”

JPMorgan Chase and Morgan Stanley have provided Stripe and Advent with a $50 billion funding package for the bid, sources told Reuters, with the bidders also putting up $17 billion ​in equity for the offer. The bidding consortium reportedly also included the FinTech Block, which dropped out after the initial bid in April.

Under the terms of the bid both Stripe and Advent would own equal stakes in PayPal.

Together, Stripe and PayPal process almost $3.7 trillion in annual volume. Stripe, which operates in approximately 40 countries, could also benefit from PayPal’s reach, with the nearly 30-year-old FinTech’s services available in over 200 countries and regions.

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