OPay Withdraws $304m US IPO After Foreign Regulatory Inquiry, Shares Fail To Trade

OPay Withdraws $304m US IPO After Foreign Regulatory Inquiry, Shares Fail To Trade

OPay has withdrawn its $304 million initial public offering (IPO) on the New York Stock Exchange (NYSE) following a regulatory inquiry in an undisclosed foreign jurisdiction, halting its planned entry into the United States stock market.

The Nigerian-focused fintech had priced 16 million American depositary shares (ADSs) at $19 each, valuing the company at approximately $4 billion. However, the shares failed to commence trading on Friday, October 30, despite the company having completed its pricing and scheduled market debut.

OPay and its underwriters subsequently agreed to terminate their underwriting agreement after reviewing the regulatory development. Brandspur Banking News Desk reports that the company described the jurisdiction involved in the inquiry as immaterial to its core business operations but did not identify the country or disclose the nature of the investigation.

In a statement, OPay said it decided against proceeding with the offering after consultations with its underwriters, expressing confidence that the matter would be resolved satisfactorily in the near future.

The withdrawal came after the company’s American depositary receipts were indicated to open between $16.25 and $16.75 on Friday afternoon in New York, below their $19 offer price.

The New York Stock Exchange subsequently reported a trading halt at approximately 3:30 pm, with news pending. No executed transactions appeared on the exchange’s message feed, meaning the anticipated trading debut did not take place.

The failed debut interrupted what would have been a major international fundraising milestone for the fintech, which had targeted approximately $304 million through the US offering.

OPay, however, maintained that the regulatory inquiry should not be interpreted as a reflection of its financial performance, business operations, financial condition or regulatory standing.

The company also assured customers and business partners that the development would not affect its operations or service delivery in Nigeria and other markets where it operates.

The fintech said it remained committed to its customers, merchants, agents, employees and business partners while working with relevant stakeholders towards resolving the matter.

The development also raises questions about the timing of OPay’s planned access to international capital markets, particularly as the company had been preparing to extend its investment opportunities to a wider pool of investors.

OPay had attracted significant attention ahead of the proposed listing, with its $19 share price placing the offering at the lower end of its initial $19 to $21 target range.

Despite the withdrawal, the company said its long-term commitment to Nigeria remained unchanged and that it would continue investing in the country’s digital financial services sector.

It has not announced a new date for the proposed US listing.