Chrysalis sells off Klarna stake for £34m after stock plunge

British investment trust Chrysalis Investments has divested its remaining stake in fintech company Klarna, selling it for £34 million after the company's value plummeted over the past year. The trust announced on Monday that it had offloaded its remaining holdings in the Swedish firm for £34 million, following a £6 million sale in July.

Chrysalis sold the stake at a higher value than it had recently recorded on its books, effectively reversing some of the significant markdowns it had taken on Klarna earlier in the year. The group plans to return £25 million from the sale to shareholders as part of a share buyback program, while maintaining £9 million to provide a "prudent operating capital buffer" and flexibility for potential future investments.

Klarna represented approximately 6.5% of Chrysalis' net assets as of March 2026, with digital bank Starling making up the majority at just under 60%. Chrysalis had already marked down the value of its holding in Starling by 5% to £356 million in the second quarter of the year, resulting in an overall portfolio value drop of 2.35 pence per share. The primary reason behind this write-down was the decline in valuation multiples among the "upper quartile" of its peers, which tracks high-growth fintechs and digital banks.

Klarna's public debut on New York's stock market just over a year ago was met with strong enthusiasm, with its shares initially rising 15% from the oversubscribed IPO price of $45.82. However, the fintech's shares have since declined by 70% since their debut. Following an unfavourable currency shift and reduced activity from softer European volumes, Klarna downgraded its revenue target for the year in August.

The Swedish fintech now anticipates making between $4.08 billion and $4.16 billion for the current financial year, a decrease from its previous forecast of over $4.34 billion.