Payment giant Stripe is considering acquiring all or part of PayPal's (PYPL.US) business.

According to people familiar with the matter, payment processing company Stripe is considering acquiring all or part of PayPal's (PYPL.US) business. The sources said that as a privately-held and one of the most valuable companies in the industry, Stripe has expressed preliminary interest in a possible acquisition of the digital payment pioneer company or its assets. The sources added that discussions are still in the early stages and it is not yet certain whether a deal will be reached. Reports on Monday stated that following a significant drop in stock prices resulting in nearly half of its market value evaporating - with PayPal's stock price falling by about 46% over the past year, PayPal is attracting interest from potential buyers for acquisition. The company, headquartered in San Jose, California, has met with several banks after receiving approaches from interested parties. After gaining 5.76% on Monday, PayPal rose by another 6.74% on Tuesday. Established in the late 1990s, PayPal was an early participant in the digital payment field. Since then, the company has faced challenges in modernizing its payment technology, while competitors such as Apple Inc. (AAPL.US) and Alphabet Inc. Class C (GOOGL.US) have taken market share. Enrique Lores, former Chairman of PayPal, will assume the role of President and CEO on March 1, replacing Alex Chriss who was removed from the CEO position earlier this month. David Dorman has been appointed as the new Chairman. According to the company's fourth quarter performance report, both its profit and revenue fell below analyst expectations, with the report also indicating a continued slowdown in payment transaction volume. Founded by brothers Patrick Collison and John Collison, Stripe has become one of the most sought-after companies in the industry. Earlier on Tuesday, Stripe announced a valuation of $159 billion in a employee stock buyback offer. Patrick Collison, President of Stripe, stated, "Obviously, PayPal has had a tough few years. With the emergence of Apple Pay and Google Pay, the industry landscape has changed significantly." "I can't talk about any hypothetical acquisition deals, but they have indeed gone through a tough period."