PayPal Commits to Making $750 Million Strategic Investment in MercadoLibre

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MercadoLibre, Inc. (NASDAQ: MELI), a Latin American e-commerce technology company, announced on Tuesday it intends to offer approximately $1 billion of common stock. The company reported it also intends to grant the underwriters a 30-day option to purchase up to $150 million of additional shares of common stock.

MercadoLibre then revealed it has entered into an agreement pursuant to which PayPal Holdings, Inc. (NASDAQ: PYPL) has committed to making a $750 million strategic investment through the purchase of common stock. MercadoLibre noted that in a separate agreement, an affiliate of Dragoneer Investment Group has agreed to purchase $100 million of Series A perpetual convertible preferred stock. The PayPal and Dragoneer investments are contingent upon the closing of the public offering and are expected to close at the same time or shortly after the public offering.

Speaking about the company’s growth and investments, Marcos Galperin, CEO of Mercado Libre,

“Over the past 20 years, we have heavily invested in developing the preeminent e-commerce and FinTech ecosystem in Latin America. We are excited to welcome these investments which will allow us to significantly accelerate our growth. We look forward to accelerating our leadership in ecommerce and payments and foster financial inclusion in Latin America as a result of our alliance with a global leader in the industry such as PayPal.”

Dan Schulman, President and CEO, PayPal, also commented:

“Digital commerce in Latin America is experiencing tremendous growth and MercadoLibre is well-positioned for continued leadership. We’ve been impressed with the digital commerce and payments ecosystem Marcos and his team have built. We see great opportunities to integrate our respective capabilities to create unique and valuable payment experiences for our combined 500 million customers throughout the region and around the world.”

Founded in 1999 and headquartered in Argentina, Mercad Libre provides solutions to individuals and companies buying, selling, advertising, and paying for goods online.    

“Mercado Libe serves millions of users and creates a market for a wide variety of goods and services in an easy, safe and efficient way.”

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