PayPal acquires money transfer firm Xoom before eBay Split

[jos]

PayPal has acquired money transfer company Xoom for $890 million to expand its digital payments business in prelude to splitting from parent, eBay.

 

Xoom, founded in 2001, lets people send money, pay bills and reload mobile phones from the United States to 37 countries. It is used widely by immigrants who send some of their earnings to family members back home.

 

PayPal’s president Dan Schulman said in a release that acquiring Xoom allows PayPal to offer a larger range of services, in overseas markets. Xoom has a particularly big presence in Mexico, India, the Philippines, China and Brazil.

 

Xoom will operate as a separate service within PayPal.

 

The acquisition comes shortly before PayPal spins off from eBay, which is expected later this month. PayPal will start publicly trading as an independent company on July 20. In the last quarter, PayPal’s payments revenue surpassed that of eBay’s marketplace business, highlighting their divergent paths as they prepare to separate.

 

 

 

 

Although acqusition is good, I cant understand the reason for its split from ebay. May be some ecnomists can shed some light to it.

 

Source: https://fortune.com/2015/07/01/paypal-acquires-money-transfer-firm-xoom-for-890-million/