FinTech Wise Plans Direct Listing On London Stock Exchange

FinTech payments startup Wise is planning to be the first direct listing on the London Stock Exchange (LSE) and is not raising any funds for it, Reuters reported on Thursday (June 17).

Headquartered in London and launched in 2011, Wise — formerly known as TransferWise — could have a valuation anywhere from $6 billion to $7 billion, Reuters reported, citing sources. The listing is expected to be among the biggest floats in 2021.

The payments firm has turned a profit since 2017, with an annual revenue growth rate of 54 percent. Sales this year were £421 million ($589 million), Wise said in a statement, per Reuters. So far this year, Wise handled cross-border transfers for 6 million users totaling £54.4 billion.

Wise is targeting a minimum free float of 25 percent and the listing is anticipated to be finished by July 5, a bookrunner said, per Reuters.

The British government has said that it is working to bring more tech companies to its capital markets in a year that so far has been temperamental for the European stock market, Reuters reported. The past few weeks have seen two initial public offerings (IPO) canceled.

The dual-class share structure Wise is targeting will enable it to support its shareholder base with new clients and “other like-minded investors” while preserving its voting majority, according to the news outlet.

“We are here for a long-term mission. For the transition period of five years we are setting up this structure so we can focus on this mission,” cofounder and CEO Kristo Käärmann told Reuters.

It’s common in the U.S. for companies to list with a dual-class share structure, but some British investors look down on it because of the disproportionate executive influence on votes relative to the size of shareholder stakes.

In January, Wise — still called TransferWise at the time — had been planning an IPO with joint coordinators Goldman Sachs and Morgan Stanley at a valuation above the $5 billion it was valued in 2020.