Fintech Firm Alfa Financial Raises $1.2 Billion in IPO, UK’s Largest of 2017

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On Friday of last week, London-based fintech firm Alfa Financial Software’s shares began being publically traded on the London Stock Exchange. Shares opened at 325 pence, giving the company an initial valuation of about 975 million pounds or US $1.2 billion, making it the UK’s largest single IPO of 2017 so far. According to Bloomberg, Alpha’s IPO is the most successful fintech IPO since software company Sophos Group raised about 1 billion pounds in 2015. Shares rose about 30% through the day which is a good sign for the UK’s struggling IPO market.

Software Solution for Automotive Finance Companies

Alfa Financial, which was founded in 1990 and formerly CHP Consulting, is a global leader in providing software solutions for asset finance companies around the world. The company’s software is used mainly by companies specializing in equipment finance and automotive finance. Clients can use Alfa’s software to manage and streamline their sales, loan originations, and asset management. Notable clients include Mercedes-Benz Financial Services, Toyota Financial Services, and the Commonwealth Bank of Australia. The focus on automotive and equipment industry clients may be the reason why their IPO was so successful since those industries have strong long-term potential, according to an article on SiliconAngle.

Good News Amidst Uncertainty Post-Brexit

A large portion of the proceeds from the offering will go to Andrew Page, chairman and co-founder of Alpha and majority shareholder, and Andrew Denton, the company’s CEO. Page will take home about 230 million pounds and Denton 24 million pounds. Page said of the success of the IPO:

We have been thrilled with the level of support and interest we have had through this process from a wide range of blue-chip investors. This IPO represents a major landmark in the development of Alfa.

Alfa’s IPO comes at a time of much hesitance for UK’s IPO markets. Post-Brexit, many investors in the UK have remained reluctant to invest in new companies given the uncertainty of how and when Britain will leave the EU. Alpha’s success may be a sign that investors are gaining confidence. Only time will tell, but hopefully, more fintech companies will view the news with positivity and decide to move forward with their own IPOs in the near future.