PayPal Holdings Inc. (PYPL) Wednesday said it has agreed to buy Honey Science Corp., a platform for shopping and rewards, for about $4 billion.
PayPal said Honey, in combination with PayPal’s two-sided network, will transform the shopping experience for PayPal’s consumers while increasing sales and customer engagement for its merchants.
Founded in 2012, Honey helps consumers find savings as they shop online. Honey includes a mobile shopping assistant, offers and rewards program, and price-tracking tools and alerts. Honey currently claims to have about 17 million monthly active users and the platform currently works across approximately 30,000 online retailers.
“Honey is amongst the most transformative acquisitions in PayPal’s history. It provides a broad portfolio of services to simplify the consumer shopping experience, while at the same time making it more affordable and rewarding,” said Dan Schulman, president and CEO of PayPal.
“The combination of Honey’s complementary consumer products with our platform will significantly enhance our ability to drive engagement and play a more meaningful role in the daily lives of our consumers. As a partner of choice for our merchants, this is another way that we can help them build and strengthen their customer relationships, provide personalized offers, and drive incremental sales. The combination of Honey and PayPal adds another significant and meaningful dimension to our two-sided platform.”
Following the acquisition, Honey will retain its headquarters and brand in Los Angeles, California. Honey co-founders George Ruan and Ryan Hudson will continue to lead the Honey team as part of PayPal’s global consumer product and technology organization, reporting to Senior Vice President John Kunze.
The transaction is expected to close in the first quarter of 2020. The acquisition is expected to be accretive to PayPal’s adjusted earnings per share in 2021.
PYPL closed Wednesday’s trading at $104.09, down $0.86 or 0.82%, on the Nasdaq. The stock further dropped $2.09 or 2.01% in the after-hours trade.
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