Financial services firm Commonwealth Bank of Australia (CBA) has invested $200m in Sweden-based digital payment technology provider Klarna, Reuters reported yesterday.
The investment follows a $100m contribution by Commonwealth to the $460m funding round closed by the company in August 2019. It increased the bank’s stake in Klarna to 5.5% according to Reuters.
Formerly known as Kreditor, Klarna provides a range of payment services including in-store payment technology, instalment payment options for consumers and an app that shoppers will be able to use to manage their retail purchases.
The deal was made alongside Klarna’s entry into Commonwealth’s home country of Australia. The bank’s customers will be able to connect their accounts to the Klarna app and it will own 50% of the company’s Australian and New Zealand businesses, Reuters stated.
Klarna’s chief executive, Sebastian Siemiatkowski, said: “This partnership with CBA is rooted in a shared obsession on how good digital experiences can truly serve consumers today.
“We believe the future of retail is high tech powering high touch experiences, so regardless of how and when consumers want to shop and pay, we need to be there for them.”
Dragoneer Investment Group led the August round, which valued Klarna at $5.5bn, taking its total funding to at least $935m. It also featured HMI Capital, Merian Chrysalis Investment Company, Första AP-Fonden, IVP, IPGL and funds and accounts managed by BlackRock.
Venture capital firm invested an undisclosed amount in the company at a $2.5bn valuation in January 2019 before fashion brand Bestseller joined Sequoia Capital for a $100m round in April that was only revealed four months later.
Fashion retailer H&M provided $20m for Klarna in October 2018, following an investment of undisclosed size by payment services provider Visa in June 2017. The latter preceded the purchase of a 10% stake by investment firm Permira through a secondary share deal a few weeks later.
Permira bought the shares from DST Global and General Atlantic. Klarna’s earlier backers also include Atomico, Northzone, Öresund, Wellcome Trust and Creandum.
