Paypal, an American online payment company, announced on Wednesday that it’s acquiring Honey Science Corporation (Honey), known for its money-saving tools for $4 billion. The acquisition marks as the biggest deal for the company in its history of two-decades.
How will the acquisition help Paypal?
Over the years, consumers have been using Paypal only at the gateway of a shopping cart, but now it will involve itself in the deal-finding process as well. This will eventually enhance the shopping experience of its consumers and will bind the consumers to stick with Paypal.
In addition to enhancing the consumer shopping experience, it will help its network of merchants to target and offer personalized promotions, resulting in increased sales.
Honey has helped consumers to save over $1B since its inception in 2012 by providing money-saving tools, alerts, and offering reward programs called Honey Gold. Paypal claims that it’s a Win-Win situation for both of the companies, as it will help Honey extend its consumer services to Paypal’s 300M customers.
What does Paypal executive say on the acquisition?
“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.
Just a year ago, the online payment company purchased iZettlle, a Swedish Payment company, for $2.2B. After the announcement, Paypal’s subsidiary Venmo’s shares fell by 2% in extended trading, CBNC reported.
“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,” Schulman mentioned in a press release.
The company will retain its headquarters in Los Angeles and co-founders, George Ruan and Ryan Hudson, will continue to lead the team and report to Senior Vice President John Kunze.
“Combining PayPal’s assets and reach with our technology, we can build powerful new online shopping experiences for consumers and merchants,” said Hudson in a statement.