June’s IPO parade starts with just one deal – dLocal Ltd. (DLO proposed). The Latin American payments-processing company priced its IPO on Wednesday night at $21 – $3 above the top of its range. dLocal shot up 54.24 percent to close at $32.39 on Thursday, June 3rd, in its first day of trading on the NASDAQ. dLocal is the latest in a flurry of payment-processing companies to go public. Its IPO follows the strong performances of Flywire (FLYW) and Paymentus Holdings (PAY) last week.
Meanwhile, Krispy Kreme, Inc. (DNUT proposed) filed its IPO plans early Tuesday – shortly after the sun came up on Wall Street. For the iconic doughnut store chain, this will be the second time around as a publicly traded company. (Source: S-1 prospectus dated June 1, 2021)
FinTech companies are in vogue. Marqeta (MQ proposed), the company whose platform enables DoorDash, Instacart, Square and others to issue their own cards and process payments, filed terms on Tuesday for its IPO next week. Marqeta is attracting considerable interest. The company has strategic agreements with MasterCard and Visa. Marqeta isn’t profitable. But it is on the CNBC Disruptor 50 list of companies.
The IPO Calendar is building up nicely for next week, buoyed by the U.S. stock market’s strength. Both the Dow Jones Industrial Average and the Standard & Poor’s 500 Index advanced in May, although the NASDAQ snapped a six-month streak of gains, The Wall Street Journal reported. Investors are concerned about inflation as the U.S. economy recovers from the COVID-10 pandemic.
dLocal Ltd. (DLO proposed) brings together the world of local payments and cross-border transactions. This is the only IPO in this holiday-shortened work week. The U.S. stock exchanges were closed on Monday for the Memorial Day holiday.
The dLocal deal was priced Wednesday night (June 2, 2021) at $21 a share – above its $16-to-$18 range – on 29.41 million shares to raise about $617.61 million. This pricing gave dLocal a valuation of about $6.06 billion. Of the 29.4 million shares sold in the IPO, 25 million were offered by selling stockholders and 4.4 million shares were sold by the company. dLocal will get about $92.4 million of the IPO’s proceeds, while the selling stockholders will get the rest.
Shares of dLocal opened at $31 – up 47.6 percent from the IPO price – in their NASDAQ debut. The stock climbed 59 percent to hit an intraday high of $33.50 before giving up some of that gain to close at $32.39.
J.P. Morgan, Goldman Sachs, Citigroup, Morgan Stanley, BofA Securities, HSBC and UBS Investment Bank are the joint book-runners.
dLocal, based in Montevideo, Uruguay, runs a proprietary cloud-based payment platform serving over 330 online merchants, including global companies such as Amazon, Didi, Microsoft, Nike, Spotify and Uber, as well as small and medium-sized businesses in emerging markets. DLocal operates in 29 countries, including Mexico, Argentina, Colombia and Chile; India and Indonesia, and Egypt, Nigeria and South Africa. (The company is incorporated in the Cayman Islands.)
dLocal is profitable. In 2020, DLocal earned $28.19 million in net income on $104.14 million in revenue.
Fidelity Management & Research Co. LLC had indicated an interest in buying up to 20 percent of the IPO – or up to $100 million, based on mid-point pricing of $17.
Seven IPOs are scheduled so far for the second week of June. More names are likely to slide into place for the next two weeks of June as the filings continue to flow in across the transom at the U.S. Securities and Exchange Commission.
(For more information, please see the IPO Calendar. You can click the hyperlinks on company names on the IPO Calendar and those links will take you to the IPO profiles on IPOScoop.com.)
(**Editor’s Note: This column was updated twice on Thursday – first with dLocal’s opening price and again at the close.)
(Never trade on proposed symbols. You might wind up owning something on the OTC Bulletin Board.)
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