Mobile payment startup Square plans sale as losses widen - WSJ

Mon Apr 21, 2014 12:28pm IST

Jack Dorsey, chairman of Twitter and CEO of Square, takes part in the Techonomy Detroit panel discussion held at Wayne State University in Detroit, Michigan September 17, 2013. REUTERS/Rebecca Cook/Files

Jack Dorsey, chairman of Twitter and CEO of Square, takes part in the Techonomy Detroit panel discussion held at Wayne State University in Detroit, Michigan September 17, 2013.

Credit: Reuters/Rebecca Cook/Files

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(Reuters) - Square Inc has been in talks with several rivals for a possible sale as the mobile payments startup looks to stem widening losses and dwindling cash, the Wall Street Journal reported, citing people familiar with the matter.

The company spoke to Google Inc earlier this year about a possible sale, the Journal reported, adding that it wasn't clear whether the talks are continuing.

Square, founded in 2009 by Jack Dorsey, co-creator of Twitter Inc, will likely fetch billions of dollars in a sale. Square insiders sold shares earlier this year on the secondary market, valuing the company at roughly $5.2 billion, the Journal said. (r.reuters.com/san68v)

The company recorded a loss of about $100 million in 2013, the Journal said, adding that the startup has consumed more than half of the roughly $340 million it raised from at least four rounds of equity financing since 2009.

Square makes credit card readers that slot into smartphones such as Apple Inc's iPhone.

Square also had informal discussions about a deal with Apple and eBay Inc's PayPal in the past, but those conversations never developed into serious talks, the Journal said.

A spokesman for Square told the Journal that the company never had acquisition talks with Google. The report also quoted a PayPal spokesman as saying that the company did not have acquisition talks with Square.

Square, Google, Apple and eBay were not immediately available for comment outside regular U.S. business hours.

Square held discussions with banks such as Goldman Sachs Group Inc and Morgan Stanley in November about a possible initial public offering in 2014.

However, the company's planned IPO has been postponed "indefinitely", according to media reports last month.

(Reporting by Arnab Sen in Bangalore; Editing by Gopakumar Warrier)

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