Nigerian fintech OPay has cancelled its New York stock market listing, a day after pricing shares to raise $304 million. The company attributed the cancellation to a regulatory inquiry in a foreign jurisdiction. OPay had priced its shares at $19 on Friday, valuing the company at about $4 billion. The SoftBank-backed payments company had planned to trade on the New York Stock Exchange under the ticker OPAY.
OPay and its underwriters mutually agreed to terminate the underwriting agreement dated October 29. As a result, the company's American depositary shares would not begin trading on the New York Stock Exchange as scheduled. The deal had been set to close on November 2. OPay did not identify the country, authority, or subject of the inquiry. The company described the jurisdiction as immaterial to its core business and expected the matter to be resolved soon.
On Friday, OPay sold 16 million American depositary shares at $19 each, the bottom of its marketed $19-to-$21 range. This price valued the company at about $4 billion, double the $2 billion valuation at which it raised $400 million in 2021. Standard Bank Group, parent of Stanbic Bank Ghana, was one of the underwriters, alongside Citigroup, Deutsche Bank, and China International Capital Corporation.
The cancellation of the IPO comes weeks after Dangote's refinery launched a naira share sale billed as Africa's biggest IPO. OPay said the decision should not be read as a reflection of its performance, financial condition, or regulatory standing. The company's services in Nigeria, Indonesia, Egypt, and Pakistan were running normally. OPay reaffirmed its long-term commitment to Nigeria, its biggest market.
OPay was founded in 2018 by Chinese billionaire Zhou Yahui, who also founded Beijing Kunlun Tech, the gaming company that once owned the dating app Grindr. Its single app offers payments, transfers, savings, and loans. According to its prospectus, OPay had about 50 million monthly active users as of July 31. SoftBank entities held a 6.6 per cent stake before the offering.
The company had also planned a secondary listing on the Nigerian Exchange after New York; its board and shareholders approved it in October. OPay has not said what happens to that listing or to the Stanbic placement. The company said only that it would give updates as material developments occur. Closer to home, regulators are tightening their grip on fast-growing payment firms.
The Bank of Ghana is preparing a separate legal framework for fintech regulation. OPay's Stanbic Africa Holdings unit had also agreed to buy up to $200 million of new OPay shares in a private placement. According to OPay's amended prospectus, that placement depended on the IPO going ahead.
Key points
- OPay cancels New York IPO due to foreign regulatory inquiry
- The company had priced its shares at $19, valuing it at about $4 billion
- OPay's services in Nigeria, Indonesia, Egypt, and Pakistan are running normally
