Klarna Acquires Walmart Business From Affirm As It Releases IPO Prospectus
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Klarna, a Swedish BNPL giant, announced that it is listing its ordinary shares on the New York Stock Exchange after successfully applying with the US Securities and Exchange Commission (SEC). The application of the shares was registered under the symbol ‘KLAR’, according to the announcement.
Morgan Stanley, J.P. Morgan, and Goldman Sachs will be acting as joint book-running managers. UBS Investment Bank, Societe generale, Deutsche Bank Securities, Citigroup, and BofA Securities will act as bookrunners. Also, Rothschild & Co, Nordea Bank Abp, Bruyette & Woods, Keefe, and BNP Paribas will act as co-managers for the proposed offering.
klarna’s $15 Billion Valuation Is Still Far Below Its $46 Billion Valuation In 2021
According to the prospectus, important figures include 675,000 merchants on the platform, 93 million active consumers globally, $21 million in net profit, $2.8 billion in annual revenue, and $105 billion in Gross merchandise volume (GMV).
The prospectus did not state the price range for the proposed offering and the number of shares to be offered by the company. However, market watchers believe a raise of around $1 billion with a market valuation of $15 billion.
The amount is over 100% more than the $6.7 billion the company raised in a funding round in 2022 during a major tech rout. But it’s still far less than its highest value of $46 billion in 2021.
Director of PitchBook’s Private Capital Research, Nalin Patel, commented on the development. He stated that Klarna’s entrance into the stock exchange will be a test for investors to know their appetite for fintech firms.
The company has now bounced back to revenue growth and profitability, which are all positive signs. However, its notably lesser valuation compared to 2021 is an indication of the cautious approach to venture capital (VC0 valuations in the present economic climate. He added that the success of Klarna in the fintech industry could have a positive impact on market sentiment and an example for other companies looking to go public with their shares.
Klarna Continues To Seek Expansion in The US
Klarna has continued to show more interests in the US market. The firm recently completed the acquisition of Walmart’s business from US rival Affirm. Klarna wants to integrate Walmart’s fintechs startup OnePay to enable the firm easily make underwriting decisions for loans. This will include quarterly and annual interest rates from 10% to 36%.
Chief Executive Officer of Klarna, Sebastian Siemiatkowski, stated that the integration is a game changer. He said millions of customers who shop at Walmart every day can now short smarter through the Klarna-powered OnePay installment loans.
