OPay withdraws planned $304m US IPO over foreign regulatory inquiry

Nigerian fintech company OPay has canceled its $304 million New York stock market listing, just hours after setting the price. The cancellation was announced on Saturday, after OPay and its underwriters mutually agreed to terminate the underwriting agreement signed on October 29. The American depositary shares, which were expected to trade on the New York Stock Exchange, would not commence trading as planned.

OPay did not specify the country, authority, or subject of the foreign regulatory inquiry that prompted the cancellation. The company stated that the inquiry's jurisdiction was irrelevant to its core business and anticipated a swift resolution. On Friday, OPay sold 16 million shares at $19 each, valuing the company at approximately $4 billion, which is double its $2 billion valuation from 2021 when it raised $400 million.

The shares, denoted by the ticker OPAY, never opened for trading. OPay's setback follows the launch of Dangote's refinery share sale, described as Africa's biggest IPO. OPay emphasized that the decision does not reflect its financial performance, condition, or regulatory standing. The company's services in Nigeria, Indonesia, Egypt, and Pakistan continued as usual, and it reaffirmed its commitment to Nigeria, its largest market.

Underwriters for OPay included Standard Bank Group, Citigroup, Deutsche Bank, and China International Capital Corporation, with Stanbic Bank Ghana's Africa Holdings unit agreeing to purchase up to $200 million of new OPay shares in a private placement. The cancellation comes amid tighter regulation of fast-growing payment firms in Nigeria, with the Bank of Ghana preparing a separate legal framework for fintech regulation.

Founded in 2018 by Chinese billionaire Zhou Yahui, OPay's single app provides payments, transfers, savings, and loans, with about 50 million monthly active users as of July 31. SoftBank entities held a 6.6% stake in the company before the offering. OPay had also planned a secondary listing on the Nigerian Exchange following New York, but the fate of this listing and the Stanbic placement remains unclear.