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Klarna has fired the starting gun on its long-anticipated stock market flotation after the Swedish buy now, pay later pioneer said it had filed initial public offering documents in the US.
The Swedish fintech said on Wednesday that it had “confidentially submitted” a draft registration statement to the US Securities and Exchange Commission.
The IPO would take place after the SEC review and the timing would be subject to market conditions, Klarna added.
Klarna has been on a rollercoaster ride since it was valued at $46bn in a 2021 deal that made it Europe’s most valuable start-up. It was then valued at $6.7bn during its last official fundraising round in 2022, as investors sharply re-rated fintech companies in response to rising interest rates.
It has also suffered from a deep governance rift between two of its co-founders — chief executive Sebastian Siemiatkowski and its third-largest shareholder Victor Jacobsson — that culminated last month in the latter’s representative being ousted from Klarna’s board.
Klarna’s choice of the US for its IPO is another blow for Europe’s capital markets following a similar decision from compatriot Spotify to choose New York for its listing in 2018.
The fintech has focused heavily on US expansion in recent years, which hit its profits. But after four years of heavy losses, it has recently returned to profitability, and Siemiatkowski told the Financial Times more than a year ago that it was ready for an IPO when market conditions allowed.
An IPO by Klarna is likely to bring further scrutiny of the controversial buy now, pay later sector. Siemiatkowski has pitched it as business that offers customers far lower fees than credit cards, but consumer groups and charities have criticised the sector for encouraging people to take on extra debt that they cannot afford.
Klarna said that the price range and number of shares to be offered in the IPO were still to be determined.