London could be about to welcome its newest tech unicorn after a Sutton-based fintech unveiled plans for an initial public offering in fresh signs of a resurgence of activity in the capital’s stock exchange.
CAB Payments, which provides business-to-business cross-border payments and foreign exchange services, said it was preparing to float shares on the London Stock Exchange’s main market.
It could fetch a valuation of £800 million to over £1 billion, according to an estimate by Mergermarket. CAB did not comment on the firm’s expected market cap.
Bhairav Trivedi, CEO of CAB Payments, said: “I am tremendously excited to take the step of listing CAB Payments’ shares via a premium listing.
“Our intention to list on the London Stock Exchange is a sign of confidence in the high quality offering we provide to our customers in a large and growing market; confidence in our strong financial profile backed by a track record of revenue and adjusted EBITDA growth, as well as cash generation; and confidence in the UK as the home for innovative and growing global businesses.
He told the Standard: “The big advantage of listing is the ability to access pools of liquidity should we need it in the future and give us the required recognition to better serve our customers.
“We did look at other markets but for us the LSE was the best option – we are extremely bullish for the UK economy as well as for the LSE and it is important to be close to home.”
The firm, which organises cross-border payment flows to and from over 150 countries, reported revenue of £109.9 million and pre-tax profits of £43.5 million in 2022. Trivedi said the company processed north of $30 billion in payments last year.
The company primarily works with governments, central banks and large banks with average transactions in excess of $100,000. The transactions include managing debt repayments between different governments and transfers of government and multilateral aid agencies during health crises and natural disasters.
The news marks the second major IPO announcement for the London market in as many weeks, following the decision last week byWE Soda, the world’s largest producer of natural soda ash, to join the FTSE main market in a flotation that could value it at up to $8 billion (£6.5 billion).
Raf De Kimpe, CEO of Fintech Week London, said: “London is still one of the biggest financial centres in the world. It certainly speaks to London’s strengths as a leading player in the fintech industry, when a firm such as CAB chooses to pursue a London listing.
“A unicorn status company is always impressive, but I think what impresses me even more in this case is that CAB has enjoyed a steady revenue stream and turned impressive profits over the last few years.
“CAB’s potential IPO is certainly a sign that we’re moving in a positive direction and demonstrates a recovery in the IPO markets that, in turn, will likely filter down into VC investment for fintechs. After the reconciliation that we’ve seen recently in the fintech industry, I’m expecting to see many other former startups and scaleups that have become big international players over the last few years also go down this route too.”
