Fund­ing Cir­cle makes lack­lus­ter $2b de­but

Viet Nam News - - MARKETS -

LON­DON — Fund­ing Cir­cle strug­gled to shine on its 1.5 bil­lion pound (US$2 bil­lion) mar­ket de­but yes­ter­day as the British peer-topeer lend­ing plat­form tested in­vestor ap­petite for both large list­ings and fi­nan­cial tech­nol­ogy firms.

Al­though shares in the com­pany backed with a 150 mil­lion pound in­vest­ment by Dan­ish bil­lion­aire An­ders Holch Povlsen ini­tially rose, they slipped dur­ing morn­ing trad­ing to be­low their launch price of 440 pence per share.

Fund­ing Cir­cle, which was launched in 2010, is the first of Bri­tain’s new breed of peer-topeer fi­nan­cial tech­nol­ogy firms to launch an ini­tial pub­lic of­fer­ing (IPO) and the flota­tion is be­ing closely watched as an in­di­ca­tor of in­vestor de­mand.

The IPO, which val­ued Fund­ing Cir­cle at around 1.5 bil­lion pounds, is ex­pected to help to set the tone for a string of large list­ings in Europe.

Lon­don is seen as one of Europe’s fi­nan­cial tech­nol­ogy hubs and bankers have been ea­gerly eye­ing the flota­tion of firms such as money trans­fer ser­vice Trans­fer­wise - a chal­lenger to banks which charge high fees for send­ing money abroad.

Based on its of­fer­ing size and pric­ing, which was set at the bot­tom end of the 420-530 pence per share range set orig­i­nally by the com­pany and its ad­vis­ers, Fund­ing Cir­cle raised around 440 mil­lion pounds on the Lon­don Stock Ex­change.

While the stock opened in Lon­don at 460 pence per share, it then slipped and was trad­ing at 439 pence at 0922 GMT.

‘In­vestor di­a­logue’

Fund­ing Cir­cle’s on­line lend­ing plat­form en­ables in­vestors in­clud­ing banks, as­set man­agers, in­sur­ers, gov­ern­ment-backed en­ti­ties and funds to lend to small and medium-sized busi­nesses in Bri­tain, the United States, Ger­many and the Nether­lands.

The com­pany said that in the six months to the end of June it had an ad­justed loss be­fore in­ter­est, tax, de­pre­ci­a­tion and amor­ti­sa­tion of 16.3 mil­lion pounds on rev­enue of 63 mil­lion pounds.

Fund­ing Cir­cle’s flota­tion is a boost to the Lon­don Stock Ex­change, which has been look­ing to at­tract large tech­nol­ogy firms for whom New York is of­ten more en­tic­ing be­cause of its track record of tech­nol­ogy floats.

Cy­ber se­cu­rity firm Avast traded lower when it went pub­lic in May 2018, while Alfa Fi­nan­cial, which pro­vides soft­ware for the as­set fi­nance in­dus­try, rose sharply on its May 2017 list­ing.

A banker work­ing on Fund­ing Cir­cle’s de­but said the deal would set the tone for oth­ers:

“Once you get to three or four, it be­gins to be a track record and it opens a di­a­logue with in­vestors.” — REUTERS

Fund­ing Cir­cle strug­gled to shine on its 1.5 bil­lion pound mar­ket de­but yes­ter­day. — AFP Photo

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