Online auction seller eBay will purchase VeriSign’s payment processing gateway business for $370 million and combine it with the PayPal merchant services to secure transactions by eBay users.
Payment gateways instantly authorize and manage online transactions. The VeriSign payment gateway division secured $40 billion in Internet transactions in 2004. The acquisition by eBay, which is expected to close by 2006, would represent a large expansion of the company’s own PayPal transaction division.
“This acquisition allows PayPal to grow our merchant services business even more quickly,” PayPal president Jeff Jordan said in a statement.
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