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From our MainFT colleagues six hours ago, a rare ray of light for the UK’s much-maligned equity market, nay, the future of the entire City of London:
UK payments company CAB Payments has raised more than £300mn in one of London’s few IPOs this year.
The offer price of £3.35 a share gave the group, which specialises in foreign exchange and payment services for businesses sending money to emerging markets, a market capitalisation of £851mn. Its shares fell more than 4 per cent in morning trading to £3.20.
The IPO, which was announced in June, is a rare bright spot for the UK stock market that has had a dearth of new listings this year. “Deciding to list signifies . . . the confidence that we have in the UK as the home for innovative and growing global fintech businesses,” said chief executive Bhairav Trivedi.
It’s not only an IPO, but a chunky one, assigning the emerging-markets-focused payments company an overall value of £851mn.
That’s right: a chunky IPO of a trendy fintech company! In London, of all places! Huzzah!
OK sure, it slipped a little in its first flash of trading, but sometimes investors just wake up grumpy and then shake it off, right? Let’s check in and see how CAB’s full glorious debut day has gone.
Oh.
It should be noted that there are idiosyncratic issues with this IPO. But there are always idiosyncratic issues with every IPO. The problem for London is that everything it touches seems to turn to dust these days. Narratives matter, and another high-profile IPO bombing instantly is . . . suboptimal, given all the soul-searching already going on.
Of course IPOs have bombed before, and ended up proving nothing more than a funny episode along the way to worldwide domination. A one-day debut drop of 10 per cent isn’t enough to mark this as another failure.
But yeah, it’s not great, either.
Further reading:
— Diagnosing London’s listing miasma
— The City needs an intervention
— WE Soda’s failure to launch is no big deal for London