Australian company Afterpay, which buys now, pays later, weighs listing in the US

Australian company Buyp-Now-Pay-Later Afterpay said on Tuesday that it is exploring a list in the US after North America became its largest market, offering global investors an easier way to own a stock that has grown following the pandemic .

Afterpay turned to Goldman Sachs for advice on listing, two sources with direct knowledge of the matter told Reuters. Goldman declined to comment.

The Melbourne-based company was last valued at nearly $ 37 billion ($ 28.7 billion), despite never making a profit due to coronavirus growth in online shopping and rapid expansion in overseas markets. , including in the United States.

Releasing its third-quarter results on Tuesday, Afterpay said sales in North America nearly tripled, surpassing Australia and helping to double the total value of transactions it processed to $ 5.2 billion compared to a year earlier.

A listing in the US would likely continue to open the Australian fintech star to an investor base that gives more weight to growth and could also provide easier access to capital to fund expansion plans.

Afterpay co-CEO Nick Molnar, who co-founded the company in 2015, told Reuters that it was a “proud Australian-based organization”, but a list in the US could provide “attractive opportunities”.

“Prioritizing in exploring a listing in the US is simply around, it gives the company a greater operational leverage in terms of market presence which is now the largest contributing segment … and gives us the right investor base,” he said. he.

Afterpay said in a statement that it intends to remain headquartered in Australia, but did not specify whether a debut in the US market will be based on a double-listing structure or result in the abandonment of the Australian berth. He also did not give a time interval.

In North America, Afterpay is opposed to Affirm, Quadpay of Zip Co, newcomer PayPal and Sweden’s Klarna, which is valued at $ 31 billion and is looking for a direct listing in the United States.

Affirm’s $ 17 billion valuation was based on 4.5 million buyers, while Afterpay had $ 14.6 million, a valuation of more than $ 47 billion, said Emanuel Datt, founder. Datt Capital, which bought Afterpay shares for around $ 7.00 in 2018.

“US investors are generally willing to pay a higher multiple for a growing business like Afterpay. This is related to the deeper capital funds available … compared to Australia,” Datt said.

Afterpay shares traded at $ 126.17 on Tuesday, on average, compared to a slight decline in the broader market. The stock has grown by more than 200% since its pre-pandemic level in February 2020.

Afterpay’s growth has slowed in Australia and this year is likely to face margin pressure as the country’s largest bank and PayPal launch BNPL offers with the promise of lower fees.

The company launched parts of continental Europe last month and plans to move to Asia. Its self-branded savings accounts related to Westpac Banking Corp are expected to be released later this year.