The celebration proved short-lived. OPay has withdrawn its $304 million initial public offering on the New York Stock Exchange, even though the deal was effectively wrapped up on paper. The company had priced 16 million American depositary shares (ADSs) at $19 each, implying a valuation of roughly $4 billion. The shares never changed hands.
Nothing hinted at such an outcome. The NYSE had approved the listing on October 27, and major institutions including Citigroup, Deutsche Bank, Standard Bank and CICC were backing the offering. As recently as Friday, during the listing ceremony, co-CEO Lars Boilesen hailed the IPO as a historic milestone for both the company and Nigeria.
It was a regulatory inquiry opened in a foreign country that turned everything around. OPay disclosed neither the jurisdiction involved, nor the authority, nor the nature of the investigation. The company said only that this country does not play a significant role in its core business. According to Bloomberg, the fintech and its banks mutually agreed to terminate the underwriting agreement so that OPay could respond to the inquiry.
Faced with mounting questions, management has sought to reassure. It argues the episode should not be read as a sign of weakness in its performance, financial condition, operational integrity or regulatory standing. Its services in Nigeria and its other markets continue to run normally, and the company says it hopes for a swift resolution.
The financial fallout, however, goes beyond the listing itself. Stanbic Africa Holdings had committed to buy up to $200 million in new OPay shares through a private placement, a capital injection that hinged directly on the IPO going ahead. For a company claiming around 50 million monthly active users as of July 31, the delay of this fundraising carries real weight.
Beyond OPay itself, the setback comes at a symbolic moment for African markets, just weeks after the Dangote refinery launched a naira share sale billed as the continent’s largest IPO. Investors will now be waiting for clarity on the nature of the inquiry before OPay makes another attempt on Wall Street.
