By Tommy Reggiori Wilkes
LONDON (Reuters) – British financial technology company Revolut has been valued at $45 billion through a secondary sale of shares to new and existing investors, the company said on Friday, making it worth more than some of Europe’s biggest banks.
The share sale, which will allow current employees to sell some of their shares, will be led by Coatue and D1 Capital Partners, as well as existing investor Tiger Global, Revolut said.
The valuation cements Revolut’s position as one of Europe’s most valuable fintechs.
At $45 billion, it is worth more than twice as much as French bank Société Générale, which has a market capitalization of $19 billion, according to LSEG data, and Britain’s Barclays, which is currently valued at $43 billion.
Traditional European banks, on the other hand, have been suffering from weak profitability and new regulations for years, which has reduced their valuations. Barclays, for example, has only reduced its shares to the level of ten years ago. Investors in Revolut are betting that the nine-year-old company has much better growth prospects than traditional banks.
The company is experiencing rapid growth, reporting record pre-tax profits of £438 million ($564.36 million) in 2023, and says it now has 45 million customers worldwide. Investors believe the UK banking license granted last month will allow the company to lure customers who want app-based banking away from branch banks without having to bear the costs of maintaining a branch network.
NO TIMELINE FOR IPO
Founded in 2015 by CEO Nikolay Storonsky, Revolut is one of a handful of financial services apps, or “fintechs,” to emerge in the UK over the past decade. The company offers financial services through an app rather than having physical branches, and was last valued at $33 billion in a 2021 capital raising.
Last month, the bank announced it had finally been granted a UK banking licence, ending a three-year wait after it ran into difficulties following an audit of its internal accounting records.
A Revolut spokesperson declined to comment on whether existing investors had reduced their stake and whether CEO Storonsky had cashed in part of his stake. The spokesperson also declined to comment on the size of the sale.
Sky News had previously reported that Storonsky would sell part of his billion-dollar stake. The sale value had previously been given as $500 million.
Revolut had previously signaled its intention to go public, but interim CFO Victor Stinga declined to comment on the IPO timetable in July.
Revolut investor Philippe Laffont, founder and portfolio manager at Coatue, said in a statement that Revolut has an “impressive product range that meets the needs of its rapidly growing customer base” and is helping to “transform the global banking industry.”
(1 USD = 0.7761 pounds)
(Reporting by Tommy Reggiori Wilkes; Editing by Jane Merriman and Susan Fenton)
