PayPal and Xoom have inked a definitive agreement under which PayPal will acquire Xoom for $890 million. The transaction has been unanimously approved by the boards of directors of both companies, as well as the board of eBay, PayPal’s parent company. Xoom is a digital money transfer or remittance providing company, that allows consumers to send money, pay bills and reload mobile phones from the United States to 33 countries, including China, India, Mexico and the Philippines.

Dan Schulman (President, PayPal): Expanding into international money transfer and remittances aligns with our strategic vision to democratize the movement and management of money… Xoom’s presence in 37 countries – in particular, Mexico, India, the Philippines, China and Brazil – will help us accelerate our expansion in these important markets.

Upon closing, Xoom will operate as a separate service within PayPal. The acquisition is expected to close in the fourth quarter of 2015, subject to customary closing conditions.

J.P. Morgan Securities is acting as financial adviser to PayPal, while Sidley Austin is acting as its legal adviser with regard to the transaction. Qatalyst Partners is acting as financial adviser to Xoom, while Goodwin Procter is acting as its legal adviser.

[Image courtesy: Xoom]