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Prospa officially floats on the ASX

by Annie Kane5 minute read

SME lender Prospa has rung the bell at the Australian Securities Exchange as it officially lists on the stock exchange.

On Tuesday morning (11 June), fintech lender Prospa officially launched on the ASX as it rung the bell in Sydney.

Prospa Group Limited (PGL) was admitted to the official list of ASX limited at noon on Tuesday on a conditional and deferred settlement basis.

The first day of trading on a normal basis is scheduled for Monday, 17 June.

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Under the IPO, the company sold 29 million shares at $3.78 per share to raise $109.6 million. 

Following IPO settlement, the SME lender will have 161.4 million shares on issue worth $609.9 million at the IPO price.

According to the lender, the majority of funds raised (above the amount raised to fund cash payments to certain existing shareholders) will be focused on “funding the equity portion of the company’s growing loan book and working capital, investment in new products and geographies and to repay corporate debt”.

Speaking after the bell ringing, Prospa founder and joint CEO Greg Moshal said: “We’re 100 per cent focused on delivering our strategy and achieving our prospectus forecasts.

“Small businesses are the engine room of the economy and they’ve long been underserved by the traditional banking system.

"The capital we’ve raised via the IPO will allow us to deliver more value to our small business customers and further invest in our brand, our new products and to support our growth in New Zealand.”

Prospa said it welcomes a range of “high-quality, long-term investors” to the share register, including current shareholder AustralianSuper, Australia’s largest superannuation fund.  

Existing long-term investors, London-based venture capital investor Entrée Capital and Australian-based venture capital investors AirTree Ventures and SquarePeg Capital, did not sell any equity in the IPO.

The indicative statement of the 20 largest shareholders also shows that the custody bodies of NAB and HSBC hold more than 2 per cent of the shares in the company.

Entrée Capital, Greg Moshal and Beau Bertoli will be subject to escrow until after the company’s financial results for the year ended on 30 June 2020 have been released to the ASX.

All other escrowed shareholders, including Square Peg Capital and AirTree Ventures, will be subject to escrow until after the reviewed financial accounts of the company for the half year ended on 31 December 2019 have been released to the ASX.

This is the second float attempt for the SME lender. Prospa was scheduled to start trading on the ASX in June last year, with a market capitalisation of $576 million after raising $146.5 million through its initial public offering.

However, minutes before listing, the lender revealed in a disclosure to the ASX that there would be a 48-hour delay so that it could “clarify queries raised by ASIC [on Tuesday] in relation to Prospa’s small-business loan terms”.

The lender further noted that these questions were “in the context of an industry-wide review” into unfair small-business loan terms. The SME lender has since undertaken a full review and update of its loan terms and became a founding signatory of the Online Small Business Lenders Code of Practice that aims to help make SME loans more transparent and easy to understand.

More to come.

[Related: Prospa confirms IPO, expects to list next month]

prospa bell ringing

Annie Kane

Annie Kane

AUTHOR

Annie Kane is the editor of The Adviser and Mortgage Business.

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