PayPal and Xoom Corp., a digital money transfer provider, Wednesday announced a definitive agreement under which PayPal will acquire Xoom for $25 per share in cash or an approximate $890 million enterprise value, according to a press release. The transaction represents a premium of 32 percent over Xoom's three-month volume-weighted average price and was unanimously approved by the boards of directors of both companies, as well as the board of eBay Inc., PayPal's parent company.

Xoom is considered one of the leading international remittance companies in the U.S. It enables consumers to send funds to, and pay bills for, family and friends worldwide using their mobile phones, tablets or computers.

"Expanding into international money transfer and remittances aligns with our strategic vision to democratize the movement and management of money," Dan Schulman, PayPal president, said in a statement. "Acquiring Xoom allows PayPal to offer a broader range of services to our global customer base, increase customer engagement, and enter an important and growing adjacent marketplace. 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."

PayPal outlined some benefits it sees in the acquisition:

• Extends PayPal's offering to Xoom customers — Broadens PayPal's consumer offering to its 68 million active U.S. customers by cross-selling Xoom’s services.
• Accelerates time to market — Xoom's proprietary and fast “funds-out” network enables PayPal to enter this growing marketplace with a leading technology solution that has a strong presence in key international markets.
• Enables expansion into new markets — Allows Xoom to expand its portfolio of send-markets by leveraging PayPal's wider international network.
• Delivers a strong technology platform — Xoom's compelling and reliable technology platform and consumer experience are coupled with its excellent customer service.

"Becoming part of PayPal represents an exciting new chapter for Xoom, which will help accelerate our time to market in unserved geographies and expand the ways we can innovate for customers," said John Kunze, president and chief executive officer of Xoom. "Being part of a larger, global organization will help us deliver the best possible experience to our customers, while maximizing value for our shareholders."