Funding Circle Chooses Bank Partners For Record-Setting Float

Funding Circle has reportedly chosen the banks to help it go public, according to Bloomberg reports from Sunday (March 11).

An unnamed source revealed that Bank of America Merrill Lynch, Goldman Sachs, Morgan Stanley and Numis Corp. will help the alternative lending platform in its initial public offering in the U.K.

Funding Circle plans to list on the London Stock Exchange. Reports said it could be the largest IPO by a U.K. FinTech, with the source noting the company’s valuation could be as high as $2.77 billion. Funding Circle plans to float in the second or third quarter of this year.

The alternative lending platform facilitates loans for small business borrowers across the U.S., U.K., Germany and the Netherlands. Its existing investors include Index Ventures, Union Square Ventures and Accel Partners, which could be big winners of the company’s IPO.

“This listing is a catalyst for the industry to be taken more seriously,” said LendInvest co-founder and chief executive officer Christian Faes in an interview with the publication. “Businesses like ours aspire to be publicly listed, and I think this does pave the way for other listings.”

The FIs named by the source did not respond to a request to comment, reports noted.

According to Funding Circle, the company is cash flow-positive as of last year, but the firm hasn’t released specific details of its earnings. It says investors see an average annual net return of 6.4 percent.

Last year, Funding Circle announced $100 million in equity funding, which analysts at the time said was a feat considering concerns over how Brexit could impact the vitality of the U.K.’s FinTech market.

“Growth has been stronger than expected, investors are hunting for yield and there’s a bounce-back from earlier in the year,” said Victory Park Capital Advisors principal Cormac Leech in an interview with Bloomberg reflecting on the investment.