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Klarna Bank AB, Europe’s most valuable startup, will likely choose the U.S. over London for the Swedish fintech company’s blockbuster stock market listing.
Chief Executive Officer and co-founder Sebastian Siemiatkowski said it’s “more likely” the buy-now-pay-later start up will opt for America for its listing as the sector faces scrutiny from U.K. authorities, according to an interview with the Sunday Times newspaper. Klarna was valued at $31 billion in a funding round this March, and the listing is likely in the next year or two.
“The majority of my investors would say that’s where you usually list,” Siemiatkowski said about the probability that the company would choose America. “But are we going to consider London? And are there elements of how you guys are thinking about changing the rules that could make it more attractive? Absolutely,” he told the paper.
Siemiatkowski’s decision comes despite Chancellor Rishi Sunak’s push to attract fintech companies in an effort to revamp the capital in the wake of Brexit. The U.K. markets regulator, the Financial Conduct Authority, has said there’s an urgent need to regulate Klarna’s sector, where users can borrow money in order to pay for transactions in installments. The chief executive had previously said that choosing a London listing would depend on the U.K. government’s post-Brexit financial services regulation.
Siemiatkowski denied that he was keeping the option open of listing in London in an attempt to convince the government to weaken regulations, the Sunday Times reported. A review ordered by the chancellor has recommended softening listing rules, such as permitting dual-class share structures in the premium part of the stock market.