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UPDATE 2-Sweden's Trustly plans $11 bln IPO as digital payments boom - sources

Published 2021-01-22, 04:28 a/m
© Reuters.

* Owner Nordic Capital eyes Q2 IPO for Trustly - sources

* Seen valued at up to 9 billion euros - source

* Digital payments sector booming in pandemic (Adds details on Trustly's revenues)

By Arno Schuetze and Abhinav Ramnarayan

FRANKFURT/LONDON, Jan 22 (Reuters) - Swedish payments firm Trustly plans to take advantage of a surge in digital transactions in the COVID-19 pandemic with a second-quarter flotation that could value it at up to 9 billion euros ($11 billion), people close to the matter said.

The initial public offering (IPO), likely in Stockholm, is one of a number of technology listings expected in Europe as investors flock to growth stocks in strong equity markets.

Trustly's owner, buyout group Nordic Capital, is working with Goldman Sachs (NYSE:GS) GS.N , JP Morgan JPM.N and Carnegie and is in the process of hiring more banks with a view to launching the IPO in late April or early May, the sources said.

The company could be valued at 6-8 billion euros, two of the people said, while another said it might fetch 7-9 billion.

Trustly's revenues were around 130 million euros in 2019 and will be around 200 million euros for 2020 on a "double digit" core earnings (EBITDA) margin, one of them added.

Nordic Capital and the banks declined to comment.

The appeal of financial technology companies has increased during the COVID-19 pandemic as more people shop online and make payments digitally to avoid physical contact.

Elsewhere, payments firm Transferwise is preparing a stock market listing in Britain with the help of Goldman Sachs, Morgan Stanley (NYSE:MS) MS.N and Barclays BARC.L that could value it at significantly more than the $5 billion suggested by a 2020 fundraising, according to a source familiar with the matter.

Many fintech firms simultaneously explore an IPO and a deal with a special purpose acquisition company, which raises money in an IPO and then buys a private firm to give it a listing.

Last month, such a "blank-check" acquisition firm backed by veteran investor Bill Foley agreed to merge with Paysafe, valuing the payments platform at around $9 billion. a further sign of investors' interest in payments firms, shares of Canadian payment processing firm Nuvei NVEI.TO jumped more than 30% on their debut in September and have now risen by 64% since their listing. Shares of European peer Nexi NEXII.MI have climbed more than 20% over the last 12 months.

Trustly, founded in 2008 and with offices in Sweden, Spain, Malta, Germany and Britain, processes more than 4 million payments per month.

Nordic Capital bought a 70% stake in the company in 2018 at a valuation of roughly 700 million euros and merged it with U.S.-based PayWithMyBank in 2019.

In June 2020, Trustly was reportedly valued at about $2 billion in a financing round that included BlackRock (NYSE:BLK), Investment Corporation of Dubai, Aberdeen Standard Investments, Neuberger Berman, and Retirement System Investment Commission.

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