The African payments giant that SoftBank is betting on is sprinting into US stocks! Opay (OPAY.US) plans to raise US$336 million and valuation may exceed US$4 billion

Zhitong Finance App learned that Opay Ltd., a payment platform focused on the Nigerian market, plans to raise up to US$336 million through an initial public offering (IPO). According to the company's filing with the US Securities and Exchange Commission (SEC) on Friday, Opay plans to issue 16 million American Depositary Receipts (ADR) at an issue price of $19 to $21 per share. Each ADR is equivalent to 10 OPay common shares. Based on the median value of the issue price range, based on the number of issued common shares listed in the file, Opay's market value is likely to exceed $4 billion. The company expects its ADR to be traded on the New York Stock Exchange under the stock code “OPAY.”

According to the documents, investors including Redwheel, Coronation Investment Management International Pty, and Sundt AS have agreed to subscribe for ADR of up to 270 million US dollars according to the total IPO issuance price. Meanwhile, documents show that Standard Bank Group Ltd. has agreed to purchase Opay's common shares through a private placement. The consideration for these shares will be determined according to a formula, taking the lower of the following two: $200 million, or the amount calculated based on potential indicators such as the proportion of Opay's issued shares after the issuance is completed and the share of Standard Bank's supervised capital.

Opay is gradually becoming one of Africa's most valuable fintech companies and a leader in the rapidly growing digital payments sector in Nigeria. In 2021, Opay raised 400 million US dollars at a valuation of 2 billion US dollars, led by SoftBank Vision Fund 2 (SoftBank Vision Fund 2). HSG (formerly Sequoia Capital China) and Long-Z Capital, a venture capital agency owned by Chinese takeaway giant Meituan, also participated in this round of financing. According to the document, in the six months ending June 30, Opay achieved net profit of 61 million US dollars and revenue of 467.1 million US dollars; in comparison, the company had a net loss of 5.9 million US dollars and revenue of 197.5 million US dollars in the same period last year.

Nigeria is the most populous country in Africa, and has become a fertile ground for fintech unicorns such as Flutterwave, Moniepoint, and Interswitch to grow. Growing demand for mobile financial services also boosted the market attention of Airtel Africa Plc's October listing on the London Stock Exchange. The company's listing raised around £529 million (US$708 million) from some supporters.

OPay's IPO will provide a valuation benchmark for Africa's venture capital-backed tech industry. Since private capital markets slowed after the pandemic, the industry has faced financing difficulties and sluggish trading activity.