Wise on course to launch IPO in May at a $6-7 billion valuation: sources

LONDON (Reuters) - British banking fintech Wise -- formerly Transferwise -- is on course to launch an initial public offering in May this year in a deal that could value the company at $6 billion-$7 billion, two sources familiar with the situation said.

The company, best known for facilitating cross-border transactions, has appointed Goldman Sachs and Morgan Stanley to manage the deal and is strongly considering London for the venue, the sources said.

A spokeswoman for the company declined to comment.

Such a listing would be a major boost for London as a hub for tech companies, with Moonpig, Trustpilot and Deliveroo already completing listings this year.

Deliveroo’s shares dropped a record 30% on the first day, prompting some concerns it would kill the London IPO market in the near term.

But the sources said Wise’s plans are not affected by this. The company rebranded from Transferwise earlier this year.

The company completed a $319 million funding round last year that valued it at $5 billion, and since reported a 70% rise in revenue to 302.6 million pounds ($418.53 million) in the financial year 2020.

It also had a net profit of 21.3 million pounds, its fourth year of profit in a row, according to its annual report.

Wise is believed to have considered Amsterdam and New York as alternative venues in the past, but is currently strongly focused on a London listing, one of the sources said.

It also does not favour the option of merging with a special purpose acquisition vehicle (SPAC) at this stage, the source added.

Like Deliveroo and The Hut Group last year, the company is considering a dual-class share structure, which will give enhanced voting rights for co-founder Kristo Kaarman and some early stage investors, including Richard Branson and Baillie Gifford.

($1 = 0.7230 pounds)

Reporting by Abhinav Ramnarayan; editing by David Evans