eBay pays $800m to buy online payments provider

EBay is paying $800m to buy Braintree, a global payment platform powering  mobile startups, cellular-news.com reported on Friday

Once the acquisition is completed, Braintree will continue to operate as a separate service within PayPal under the continued leadership of Braintree Chief Executive Officer  Bill Ready, who will report to PayPal President David Marcus. Braintree’s management team and employees are expected to stay in place.

Venmo, Braintree’s mobile application that gives people a way to pay each other using their mobile devices and leveraging social networks, is part of the acquisition and will help to contribute to PayPal’s mobile payments capabilities.

PayPal already has a strong presence in mobile, projecting mobile payment volume of more than $20bn this year.

Assuming PayPal’s acquisition of Braintree closes in late 2013, eBay anticipates an immaterial impact to PayPal’s 2013 net total payment volume.

eBay expects that definitional differences between PayPal’s net total payment volume and Braintree’s projected $12bn payment volume for 2013, approximately one-third of which is expected to be driven by mobile payments, will lead to a significant portion of Braintree’s payment volume not being additive to PayPal’s net total payment volume and treated instead like PayPal’s payment gateway business, with only the revenue being recorded.

Punch