BNPL provider IOUPay recently completed a $50 million capital raise to pay for growth initiatives including digital payments and to accelerate new business development opportunities in the BNPL sector in South East Asia.
The significant placement completed within 48 hours was the largest single raising in the company’s history and was the result of strong demand from both new and existing institutional investors. 100 million shares were offered to investors at an offer price of 50 cents per share, which represented a 15% premium to the company's 15 day volume-weighted average price, while being a 28% discount to the closing price of $0.70 on 15 February.
Considering IOU was trading at 15 cents at the beginning of February, the company is very pleased with the result.
In relation to the completion of the placement, IOU Chairman Aaron Lee noted: “The Company is delighted to see the market respond so strongly to our plans to accelerate our market position as a leading operator in the digital payments and BNPL sectors in South East Asia. This capital raising represents another important milestone in our roadmap to expand our existing and new product offerings and accelerate the growth potential of that expansion."
The recent surge in activity came following the company's announcement on February 9 that it entered into a Merchant Referral Agreement with EasyStore Commerce in Malaysia to enable EasyStore’s merchants and end-user customers to utilise IOUpay’s BNPL payment services.
EasyStore services more than 7,000 merchants across the South East Asian markets, which include Malaysia, Singapore, Indonesia, Philippines, Thailand, Hong Kong and Taiwan. In 2020, EasyStore merchants processed over 20 million transactions with a total transaction value of approximately $435 million.
EasyStore differentiates itself from the more common single store e-commerce platforms which consist of large online shopping malls that display marketplaces of merchant products and services by categories and price ranges, by instead providing merchants with one single integrated platform to customize and manage their business across multiple online sales channels. This includes SEA’s largest online shopping malls such as Lazada and Shopee and all major social media platforms including Facebook, Instagram, WhatsApp, LINE and WeChat.
IOU shares closed 24% higher on Wednesday.