Africa’s payment giant backed by SoftBank is rushing to list in the US! Opay (OPAY.US) plans to raise $336 million, with its valuation possibly exceeding $4 billion

According to news from Zhitong Finance APP, Opay Ltd., a payment platform focused on the Nigerian market, plans to raise up to $336 million through an initial public offering (IPO). According to documents the company filed with the United States Securities and Exchange Commission (SEC) on Friday, Opay plans to issue 16 million American Depositary Receipts (ADR) at an issuance price of $19 to $21 per share. Each ADR represents 10 ordinary shares of Opay. Based on the midpoint of the price range and the number of ordinary shares listed in the filing, Opay's market capitalization could exceed $4 billion. The company expects its ADRs to be listed on the New York Stock Exchange under the ticker symbol “OPAY”.

The filing shows that investors including Redwheel, Coronation Investment Management International Pty, and Sundt AS have agreed to subscribe for up to $270 million in ADRs at the IPO price. Meanwhile, the filing shows that Standard Bank Group Ltd. has agreed to purchase Opay ordinary shares through a private placement. The consideration for these shares will be determined according to a formula, with the final amount being the lower of the following two: $200 million or an amount calculated based on potential indicators such as the proportion of Opay shares outstanding after the offering and Standard Bank’s regulatory capital ratio.

Opay is gradually becoming one of Africa’s most valuable fintech companies and is also the dominant player in Nigeria’s rapidly growing digital payments sector. In 2021, Opay raised $400 million at a $2 billion valuation, led by SoftBank Vision Fund 2, with participation from HSG (formerly Sequoia Capital China) and Long-Z Capital, the venture capital arm of Chinese food delivery giant Meituan. According to the filing, in the six months ended June 30, Opay achieved a net profit of $61 million and revenue of $467.1 million; in comparison, during the same period last year, the company had a net loss of $5.9 million and revenue of $197.5 million.

Nigeria, the most populous country in Africa, has become fertile ground for fintech unicorns such as Flutterwave, Moniepoint, and Interswitch. The growing demand for mobile financial services has also boosted market attention for Airtel Africa Plc's listing on the London Stock Exchange in October, which raised about £529 million (approximately $708 million) for some of its backers.

This IPO by Opay will provide a valuation benchmark for Africa's VC-backed tech sector. Since the post-pandemic slowdown in private capital markets, the sector has been facing financing difficulties and sluggish deal activity.