Openpay raises $33 million in a day

Melbourne buy-now-pay-later startup Openpay’s stellar week continued on Thursday when the company raised an additional A$33.77 million through an oversubscribed local institutional placement.

The raise comes in a week where Managing Director and CEO Michael Eidel announced the fintech had secured a UK funding facility for £25 million (A$46 million) for its British business, adding to the existing $75 million in debt facilities already in place. Openpay also reported its best month of growth in May 2020.

Openpay’s (ASX:OPY) share price has soared after starting the week at $1.30 before gaining 26% following the debt facility announcement. It then leapt 51% on Wednesday to a record high of $3.02 before trading was halted pending the raise. When trading resumed on Thursday, shares skyrocketed again to close at $3.51.

The current price gives the business a market cap of $329 million.

Thursday’s raise saw new and existing institutional investors take up 14,069,742 shares, raising approximately A$33.77 million at $2.40 per share. The issue price represents a 9.8% premium to the 5-day volume weighted average price (VWAP) of $2.185, a 12.1% discount to the 1 day VWAP of $2.730 and a 20.5% discount to the last closing price on 3 June 2020 of $3.02.

The placement represents 15% of Openpay’s issued capital and is scheduled to settle on 10 June with trading from 11 June.

Michael Eidel said that alongside the significant uptake the BNPL sector has seen since its introduction, it demonstrated its value during the coronavirus pandemic.

“The combination of the macro environment and the way we’ve been servicing our customers has enabled us to take the business to new heights,” he said.

“We have consistently delivered on our growth strategy and there was a strong response this week to the news that Openpay had both secured debt funding for our UK business and reported record growth.

“Our positive momentum has been further reinforced after several leading institutions reached out offering funding to accelerate our growth plans. We are pleased to have been offered this show of support and look forward to deploying the capital to further grow the business.”