Nubank files for double IPO: NYSE and B3

Nubank is targeting a market value of more than $50 billion for its initial public offering in the US

Nubank buys Olivia — REUTERS/Paulo Whitaker

01.Nov.2021 10:56 BRT
UPDATED 16:43 BRT

If Nubank secures the valuation it craves in its IPO, it will also overtake Itaú Unibanco;
Last week, Nubank said it had filed a confidential application for its IPO with US regulators.

Nubank has officially filed for its IPO request on the New York Stock Exchange (NYSE) and Brazil’s B3. The largest neobank in Latin America (and also in the world) plans to use its IPO proceeds for working capital and acquisitions, among other investments. Nubank hopes to raise $3 billion (BRL 16.8 billion) with both offerings. It targets a market value of more than $50 billion for its initial public offering in the US, making the digital bank more valuable than Brazil’s largest bank, Itaú Unibanco, valued at $38 billion.

At that size, the neobank’s IPO, reported Reuters, will rank as one of the biggest of the year in the U.S., alongside offerings from e-commerce company Coupang, Chinese app-based transportation company Didi Global and chipmaker GlobalFoundries.

The Sao Paulo-based fintech, valued at $30 billion in June after a funding round led by Warren Buffett‘s Berkshire Hathaway, is expected to list its shares by the end of the year.

In its most recent document, Nubank opened up its financials for the first time, revealing a big jump in growth – its revenue nearly doubled to $1.06 billion in the nine months ended September 30. Losses in the same period, however, increased from $64.4 million to $99.1 million.

Nubank makes money mainly through fees paid by merchants whenever a customer makes a transaction. In October, the fintech said it managed to make a profit in the first half of 2021 on its operations in Brazil.

Founded in 2013 by David Vélez, a Colombian who studied at Stanford, Nubank started as a credit card issuer that charged no annual fees. Since then, the bank has gained more than 48 million customers and launched several products, including checking accounts and personal loans.

Following the IPO, co-founders Vélez, Cristina Junqueira, and Adam Edward Wible will hold 87% of the voting power and 25% of the company’s outstanding shares, provided the underwriters do not exercise a so-called greenshoe, which allows companies to sell additional shares to buyers during an IPO.

Nubank will list its shares on the New York Stock Exchange under the code “NU” and its BDRs on B3 under the code “NUBR33”.

Morgan Stanley, Goldman Sachs, Citigroup, and NuInvest are the lead underwriters of the offering.

(Translated and co-written by LABS)