Wise joins London market in £8bn debut

Fintech Wise is to make its London debut on Wednesday through a rare direct listing.

The cross border payments specialist, formerly known as TransferWise, first announced in June plans to join the London market.

It has opted to use a direct listing, however, rather than a traditional initial public offering. Under a direct listing, there is no public offer of existing or new class A shares at the time of admission, which means no pre-determined price or price range is set, nor are investment banks required to underwrite the offering

However, the shares were indicated to open around 800p, according to Reuters, which would give it a market capitalisation of around £8bn.

Wise noted in the prospectus: "We are taking steps to become public in a way that is transparent and fair. By doing a direct listing, we are ensuring everyone gets the same opportunity to ow part of Wise as large institutions.

"We’re allowing our existing shareholders to sell on their own terms, and allowing the open market to set a price in a transparent way that’s fair for all."

The London-headquartered firm, which last year was valued at around £4bn following a secondary share sale, was founded by Estonians Taavet Hinrikus and Kristo Kaarmann in 2011.

Unlike a number of other highly-valued fintechs, Wise is profitable, having broken even in 2017. In the year to 31 March, it reported revenues of £421.0m, compared to £302.6m a year previously, and pre-tax profits of £41.1m against £20.4m in 2020.

According to Wise’s prospectus, admission of the A shares was scheduled for 0800 BST, with dealings due to commence "no later than shortly after 1122 BST" on 7 July.

Wise is being advised by Goldman Sachs and Morgan Stanley.