Klarna lays groundwork for IPO; avoids strike

The firm has begun the process for a legal entity restructuring to set up the holding company in what it calls “an important early step on a journey towards an eventual IPO”.

A listing could happen in the first half of next year, according to Sky News, which first reported the plan. However, Klarna could still opt not to float in London and instead turn to New York.

The company could secure an IPO valuation of between $15 billion and $30 billion, according to Sky. That would be more than double its valuation at its last funding round, in 2022, but way down on the $46 billion price tag it had in 2021.

The drop in valuation came amid a torrid time for the BNPL pioneer, which cut a tenth of its workforce and saw its valuation savaged amid a tech market recalibration.

However, it has since showed signs of recovery, this week reporting a net profit for the third quarter, with particularly strong growth in the US, where it saw a 46% year-on-year rise in gross merchandise value.

Separately, the company has averted a strike by employees at its Swedish headquarters. The Unionen and Swedish Engineering unions had warned that their members would strike on 7 November if they did not secure a collective agreement.

Now, mediators have negotiated a deal that will see Klarna become a member  of BAO, the banking institutions’ employer organisation, and will be covered by the collective agreement between BAO and unions.

“I am convinced that we will benefit from this agreement and that Klarna can contribute to making the Swedish model stronger from the inside.” says Sebastian Siemiatkowski, CEO, Klarna.