|08 April, 2019

UAE's Finablr considers London float that could raise at least $200mln

Plan comes after its rival firm Network International's IPO drew strong demand from investors

Image used for illustrative purpose. A customer exchanges money at a currency exchange center in Dubai.

Image used for illustrative purpose. A customer exchanges money at a currency exchange center in Dubai.

REUTERS/Ahmed Jadallah

ABU DHABI/DUBAI: United Arab Emirates-based payments and foreign exchange company Finablr is considering a stock market flotation in London that could raise at least $200 million to finance expansion and cut debt.

Finablr, whose brands include UAE Exchange, Travelex Holdings and Xpress Money, said on Tuesday it could sell a mix of new and existing shares totalling at least 25 percent of its equity, though a final decision had not been made to proceed with the issue.

The plan comes after its rival Network International's initial public offering (IPO) drew strong demand in a deal that could raise 870 million pounds ($1.1 billion). Network is set to price at 435 pence per share, a term sheet showed on Monday. 

The two deals could end a drought in the European IPO market, which has seen proceeds slump to $292 million in the first three months of 2019 from $13.9 billion a year ago, Refinitiv data shows.

Payments processing assets have become highly sought after as consumers worldwide switch to digital from cash, commanding impressive valuations for companies in the sector.

Finablr Chief Executive Promoth Manghat told a conference call it would be premature to talk about proceeds or the exact number of existing shares to be sold, since the company had not made a final decision to proceed with the IPO.

Sources had earlier told Reuters the company intends to raise a total of about $500 million from the offering.

Finablr's net debt stood at $564.2 million at the end of 2018, about 2.5 times core earnings or EBITDA, a level Manghat said the company is comfortable with.

The group's adjusted EBITDA for 2018 was $210.4 million.

The Finablr network has a global reach spanning more than 170 countries and manages $114.5 billion in volumes for its clients as of December, the prospectus showed.

Its biggest markets are India, Pakistan, Bangladesh and the Philippines. UAE Exchange bought Travelex, the world's largest foreign exchange specialist, in 2016 for 800 million pounds ($1 billion).

Founder B.R. Shetty took another company he founded, NMC Health, public on the London Stock Exchange in 2012.

JPMorgan, Barclays and Goldman Sachs are global coordinators for the deal. Bookrunners include Bank of America Merrill Lynch, EFG Hermes and Numis. Evercore is acting as financial advisor.

($1 = 0.7648 pounds)

(Additional reporting by Noor Zainab Hussain in Bengaluru Editing by David Holmes) ((Saeed.Azhar@thomsonreuters.com; +971 521047569; Reuters Messaging: saeed.azhar.reuters.com@reuters.net))

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