KEY TO REMEMBER
- Swedish fintech company Klarna has announced that it has filed for a long-awaited IPO in the United States.
- Klarna said Tuesday it “confidentially submitted” a draft registration statement to the Securities and Exchange Commission, noting the number of shares it plans to offer and the price range of an IPO have not yet been determined.
- Klarna’s market value has fallen since the pandemic, as interest rates rose and the online shopping frenzy waned.
Swedish fintech company Klarna said it has filed for a long-awaited event initial public offering (IPO) in the United States
Klarna said on Tuesday it had “submitted in confidence” a draft registration statement to the Securities and Exchange Commission (SEC), noting that the number of shares it plans to offer and the price range of an IPO remain to be determined.
The IPO is expected to take place after the SEC reviews Klarna’s filing, on specialist in buy now, pay later said.
The buy now, pay later principle allows consumers to split a purchase into multiple installments and has gained popularity in recent years as high interest rates hurt consumers’ wallets. Founded in 2005 in Sweden, artificial intelligence (AI) Marketing-focused Klarna now has around 85 million customers worldwide and has recently deployed new savings and spending account features in a bid to take on the legacy banking industry.
Klarna was last valued at $6.7 billion in 2022
Yet Klarna’s market value has fallen since the pandemic, as interest rates rose and the online shopping frenzy waned. It was valued at $6.7 billion, the company announced in July 2022, following a fundraising during a stock rout. This was a far cry from a peak valuation of $45.6 billion in 2021.
The IPO could value Klarna between $15 billion and $20 billion, according to the Financial Times reported. The report says fintech’s costly expansion in the United States in recent years, as it attempted to to assume rival Affirm Holdings (AFRM)—weighed on profits.