Melbourne buy now, pay later (BNPL) fintech Openpay (ASX: OPY) became the last major startup listing for 2019, although initial trading wasn’t as auspicious as MoneyMe’s debut last week and Tyro in early December.
Openpay raised $50 million issue at $1.60 per share for a market capitalisation of $150 million. Demand for the IPO exceeding the $50m target, leading to substantial scaling back of allocations.
After opening trade at noon at $1.65, with a few hundred thousand dollars worth of shares changing hands, but in less than a minute, their price had fallen below the IPO price, dropping as low as $1.28 in lunchtime trade before staging a small rally to hover just under $1.40.
Before trade began, Openpay CEO and Managing Director, Michael Eidel, said the business had seen strong growth in Australia and launched in the UK as a first step in its international expansion.
“Listing on the ASX reinforces our commitment to strong regulation and governance and provides a great opportunity for investors to participate in what we see as a fast-growing, globally relevant Australian company,” he said.
The payments technology platform services merchants across four key household spend verticals – consumer retail, healthcare, automotive and home improvement.
Active merchants had year-on-year growth of 74.8% to 30 November 2019 vs 68.5% to 30 June 2019, while active customers grew 84.9% vs 62.4%, respectively and active plans 169.4% vs 110.5%, respectively
Openpay reported 1,834 active merchants at 30 November 2019.
Recent additions include the retailers The Just Group brands online, Hanes Australasia brands and Total Tools both instore and online, in healthcare United Vets Group and Vision Australia, and in automotive the LSH Group and Duttons Motor Group.
In the UK, Ideal Shopping Direct, and retailer JD Sports, are new sign ups, with online trading expected to commence during the March 2020 quarter.
Funds from the IPO are earmarked towards working capital, product development, talent acquisition, UK expansion, and continued enhancement of its technology platform.
The business is looking to expand into New Zealand, expand into new household verticals and develop a B2B payments solution.
Openpay’s first statutory reporting filing as an ASX-listed company will be its quarterly cashflow
and activities reports for the quarter ending 31 December 2019, scheduled for release in January 2020.
- EDITOR’S NOTE: Openpay shares closed at $1.325 on their first day of trade. 5,393,779 shares changed hands.