Stripe and buyout firm Advent are no longer pursuing a reported acquisition of PayPal, according to Engadget, which cites Bloomberg and people familiar with the matter. The abandoned pursuit would have centered on one of the largest leveraged buyouts ever, with a potential transaction valued at well over $50 billion, according to the report. The reported approach came as PayPal was under market pressure. Engadget says that in July, when PayPal was trading near historic lows and valued at about $40 billion, Stripe and Advent made an offer worth around $53 billion. PayPal reportedly rejected that offer, and the Stripe-led group was said to be preparing a higher bid. The arithmetic appears to have shifted after PayPal’s latest quarter. Engadget reports that the company beat most estimates, and that the earnings result, together with takeover rumors, helped push PayPal’s stock up 40%. That stock move may have increased the price a buyer would need to pay and made a leveraged takeover harder to execute, according to the report. PayPal’s valuation history frames the scale of the potential discount. Engadget notes that PayPal was worth as much as $320 billion at its peak market value during the height of the COVID pandemic. Against that backdrop, a $53 billion reported offer would still have been a major deal, but far below PayPal’s pandemic-era market capitalization. The strategic logic, as described by Engadget, was not only financial. The report says a Stripe-PayPal combination could have reduced Stripe’s reliance on Visa and Mastercard, while giving Stripe access to PayPal assets including Venmo checkout and crypto features. Those points describe why PayPal’s network and consumer-facing products may have been attractive to a payments infrastructure company. Engadget also reports that PayPal’s CEO Enrique Lores, appointed in March, has been working on a turnaround by dividing the company into three units focused on checkout, Venmo, and payments/crypto. For now, the reported acquisition effort has stopped, but Bloomberg said Stripe and Advent could still choose to bid for PayPal in the future. Who benefits: PayPal shareholders benefit if operating momentum and takeover interest continue to support the stock. PayPal management also gets more room to pursue its turnaround without an immediate sale process, based on the report. Who's exposed: Stripe and Advent are exposed to valuation discipline: a higher PayPal share price can make the financing and return profile of a leveraged deal harder. Rival payments networks are only implicated to the extent Engadget reports that a merger could have reduced Stripe’s reliance on Visa and Mastercard.