PayPal has agreed to purchase Stockholm-based payments provider iZettle in an all-cash deal valued at $2.2 billion, the company announced this week.

Founded in 2010 by Jacob de Geer and Magnus Nilsson and launched a year later, iZettle is a leading small business commerce platform in Latin America and Europe with nearly half a million merchants on its platform.

iZettle is commonly referred to as the "Square of Europe" and that's exactly the approach PayPal is taking with the acquisition as it'll look to expand its in-store presence and compete more directly with other payments providers like Stripe and the aforementioned Square.

PayPal President and CEO Dan Schulman said small businesses are the engine of the global economy and they are continuing to expand their platform to help them compete and win online, in-store and via mobile.

Once the deal closes, PayPal says it'll gain in-store capabilities in 11 markets including Brazil, Denmark, Finland, France, Germany, Italy, Mexico, Netherlands, Norway, Spain and Sweden. We're also told that de Geer will continue to lead iZettle upon close, operating the company as a part of PayPal's merchant services offering and reporting directly to PayPal Chief Operating Officer Bill Ready.

iZettle forecasts generating gross revenues of $165 million in 2018 and processing approximately $6 billion in total payments on its network. Assuming there are no unforeseen regulatory hurdles, the acquisition is expected to close in the third quarter of this year.