Remitly, a US-based remittance services provider backed by payment services firm Visa, insurance provider Prudential Financial and internet group Prosus, raised $523m in its initial public offering yesterday.
The company issued just under 12.2 million shares on the Nasdaq Global Select Market priced at $43 each, above the IPO’s $38 to $42 range. They are trading at $46.83 at time of publication, suggesting a market capitalisation of $7.6bn.
Founded in 2011, Remitly operates a remittance service that lets customers send money internationally through digital channels including online and mobile devices. It has in excess of 5 million customers globally and processes more than 75 currencies.
The company reported $202m of revenue for the first six months of 2021, up from $105m in the same period the year before, and its net loss was cut from $21.1m to $9.2m.
Remitly picked an investment of undisclosed size from Visa in May this year, following a series F round that closed at $88m two months earlier, according to the IPO filing, taking its total debt and equity financing to approximately $523m.
Prosus’s payment technology arm, PayU, invested $52.5m to lead the $85m first close of the round in July 2020, and it also featured Generation Investment Management (Generation IM), Owl Rock Capital, Stripes Group, DN Capital, Top Tier Capital Partners, Princeville Global and Threshold Ventures.
The company raised $135m in a mid-2019 series E round led by Generation IM that included PayU, Prudential, investment bank Schroder, Owl Rock, Princeville, Top Tier, DN Capital and Stripes.
PayU also led Remitly’s $115m series D round in 2017, which was backed by Stripes, DFJ and DN Capital. Its earlier investors include International Finance Corporation, Vulcan Capital, Trilogy Equity Partners, Bezos Expeditions, QED Investors, TomorrowVentures, Founders Co-Op and various private backers.
PayU bought $24.9m of shares in the offering and remains Remitly’s largest shareholder, with a 23% stake down from 23.7%. Other significant shareholders include Stripes, which now owns a 11.4% stake, as well as Threshold Ventures (8.9%), Generation IM, which sold $52.9m of stock (6.8%), and Trilogy Equity Partners (5.9%).
Prudential Financial sold $32.5m of shares and will maintain a 1.1% stake, while DN Capital divested $62.9m of shares and now owns a 2.7% stake.
Goldman Sachs and JP Morgan are book-running managers for the offering, Barclays, Citigroup and William Blair are joint book-running managers and JMP Securities, KeyBanc Capital Markets, Wolfe I Nomura Strategic Alliance, Cabrera Capital Markets and Blaylock Van are co-managers.
The underwriters have a 30-day option to purchase an additional 1.8 million shares. If exercised, the option could increase the IPO size to approximately $601m.