Chrysalis Investments and Scottish Mortgage are set to see a boost to NAV as fintech giant Wise readies itself for a £9bn listing on the London Stock Exchange.
According to Sky News the digital payments firm, which rebranded from Transferwise earlier this year, could launch a direct listing as soon as this week, although this could be delayed pending regulatory approval.
Wise plans to list without raising new capital from investors and is expected to fetch a valuation of up to £9bn. Last July, the company sold $319m worth of shares, bringing the value of the fintech company to $5bn.
The arrival of Wise’s long-anticipated London flotation is good news for City investors like Chrysalis Investments duo Richard Watts (pictured left) and Nick Williamson (pictured right) and Baillie Gifford which have ploughed millions into the payments app.
Wise currently makes up 8.4% of Chrysalis Investments’ concentrated portfolio as of 28 May. This is down from December 2020 when it accounted for 12% of the trust’s net asset value.
James Anderson and Tom Slater’s gargantuan Scottish Mortgage trust also hold the tech unicorn, albeit a smaller amount. Wise made up just 1% of the trust’s £9.2bn NAV, according to its annual results for the year ended 31 March 2021. Since then NAV has doubled to £18.1bn.
Chrysalis, which has held Wise since November 2018, has already taken profits on the digital payments company, selling down $25m worth of shares last July, according to its last set of annual results. This coupled with the IPO of other major holding The Hut Group, helped the trust deliver 48.2% growth in NAV in H2 2020.
The trust has already seen a “material uplift” to NAV this year from holding Starling Bank which was valued at £1.3bn after its last funding round.
Dual-class share structure to benefit early investors like Baillie Gifford
Similar to Deliveroo, Wise is planning to list with a dual-class share structure, which will enable founders Kristo Kaarmann and Taavet Hinrikus and early investors like Baillie Gifford and British billionaire Richard Branson retain voting control, according to Sky.
Founded in 2011, the money-transfer specialist has 10 million customers and $7bn is sent by Wise every month. Last summer it received a license from the Financial Conduct Authority permitting it to offer investment products.
In the year ended March 2020, TransferWise saw a revenue increase of 70% to £302m, while Ebitda increased from around £18m to £42m.