Seeing over-range prices with further signs of the hot IPO market

Consumer lenders, led by PayPal co-founder Max Levchin, confirm that they sold shares well above their expected price range at the time of their initial public offering as a sign of continued enthusiasm for a new listing in the United States.

The San Francisco-based company raised $ 1.2 billion after selling its shares for $ 49 a share, two sources said, with price levels already rising from $ 41 to $ 44. It was beyond the dollar range.

Affirm will have a market capitalization of $ 11.9 billion at an IPO price based on the number of issued shares after the initial public offering. The company declined to comment.

Affirm’s list extends the enthusiastic implementation of the tech IPO dating back to late last year, resulting in a second big win almost 20 years after Levchin helped PayPal go public.

Founded by Levchin in 2012, Affirm offers “buy now, pay later” products that online shoppers can use to spread payments for high-value items. Affirm derives most of its revenue from the fees it charges merchants, and customers often pay interest-free. The company also offers interest-bearing loans with no late fees.

Sales through fitness company Peloton have historically generated most of Affirm’s business, accounting for 28% of the company’s total revenue for the 12 months to June.

The company reported a net loss of $ 113 million with revenue of $ 510 million for the 12 months to June, from a loss of $ 121 million with revenue of $ 264 million in the previous fiscal year. It has been reduced.

The boom in the online consumer finance business means we are facing competition from overseas groups such as Afterpay and Klarna, and PayPal, which has introduced buy now.

Affirm’s IPO takes place during a busy week of initial public offerings in the United States. E-commerce site Poshmark and mobile gaming company Playtika will also be available in the coming days, providing early testing of this year’s market.

At Affirm’s IPO price, Levchin will own nearly $ 1.4 billion worth of shares in the company. Since leaving PayPal, he has become known as a prolific investor, helping tech start-ups through his company, SciFi VC, and launching new companies through a means called HVF.

Singapore’s sovereign wealth fund GIC was Affirm’s largest external investor and held shares worth approximately $ 1.1 billion at IPO prices. Shopify, a Canadian e-commerce company, also held more than $ 990 million in shares it received from a partnership with Affirm last year, allowing fintech companies to offer products on Shopify’s merchant site. ..

Morgan Stanley, Goldman Sachs and Allen & Company were lead underwriters for this offering.

Seeing over-range prices with further signs of the hot IPO market

Source link Seeing over-range prices with further signs of the hot IPO market

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