Trustly announces plan for Nasdaq Stockholm IPO

Swedish payments company Trustly has become the latest fintech start-up to announce its intention to go public, saying Monday that he was looking for a valuation of around $ 9 billion.

Trustly is looking to list on Nasdaq in Stockholm in the coming weeks and aims to raise around SKr 8 billion ($ 930 million) in new capital while its majority shareholder – Swedish private equity firm Nordic Capital – will sell its stake.

People familiar with the list said it was aiming for a valuation of around SKr70bn to SKr75bn ($ 8.2bn to 8.8bn) after weeks of discussions with potential investors.

“It’s a way to ensure that the business can remain independent. The company reached the size where it started to grow too big for a private environment, ”Chairman Johan Tjarnberg told the Financial Times.

The announcement comes as investor interest in payment groups grows, Stripe in the US and Sweden’s Klarna, both unlisted, triple their evaluations over the past few weeks.

Unlike most payment startups such as Klarna and Stripe that rely on card networks, Trustly has developed its own platform allowing consumers to pay directly of their bank accounts. He claims that by cutting out middlemen such as card issuers and banks, it can cut costs for merchants in half.

Trustly, founded in 2008 and in which Nordic Capital took a majority stake in 2018 during a Valuation of € 700m, presents itself as one of the fastest growing companies in Europe in terms of revenue and a start-up with solid profitability.

Tjarnberg said he plans to have an “rule of 80” for the next five years, under which the sum of the growth in its annual net sales and its underlying operating profit margin – both as a percentage – would be greater than 80 percent.

Last year, Trustly processed $ 21 billion in transactions and had revenue of SKr 2 billion, 40% more than in 2019. Its underlying profit before interest, taxes, depreciation and amortization was SKr 907 million, taking into account an adjusted ebitda margin of 46%.

General manager Oscar Berglund told the FT that there was considerable interest among young consumers who did not want to pay by credit card or buy now, pay later for services like Klarna.

He dismissed concerns that the EU’s transition to an open bank – which opens consumer accounts across the continent – would hurt Trustly, arguing it had a proven platform and business model.

Tjarnberg, whose own payments start-up Bambora was sold by Nordic Capital to Ingenico for € 1.5 billion four years ago, said he had never seen such interest in the industry. before. “There is a huge appetite for this account-to-account space. . . It’s a way of controlling your own destiny, ”he added.

Trustly is present throughout Europe, but its largest market will soon be the United States, where it is experiencing strong growth. He said he would use the IPO proceeds to repay his credit facilities and repurchase his outstanding preferred shares.

Carnegie, Goldman Sachs and JPMorgan are global co-coordinators while eight other banks are co-bookkeepers.

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