Klarna, the Swedish buy now, pay later (BNPL) giant, is reportedly selling most of its British BNPL loans in a strategic deal with American hedge fund Elliott. This move is expected to free up as much as $39 billion for new loans, which Klarna aims to utilize in bolstering its growth in the U.S. market, where BNPL is rapidly gaining traction. The company will still underwrite the loans and provide customer service, ensuring continuity for borrowers. Klarna's Chief Financial Officer, Niclas Neglen, emphasized that this deal will enhance the effective management of assets and shareholder equity. With plans for an initial public offering (IPO) next year, Klarna is eyeing a valuation of around $20 billion. The growing preference for BNPL among American consumers, particularly millennials, highlights the potential for Klarna's expansion in a market where traditional payment methods are increasingly being abandoned.
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