WeTransfer pulls IPO amid market volatility

Dutch file-sharing company WeTransfer is ending an initial public offering (IPO) in Amsterdam due to market volatility, multiple media reported on Thursday (January 27th).

The company was due to start trading on Euronext Amsterdam (AEX) on Friday January 28 and was initially looking to raise 160 million euros ($182.7 million) in the offering. Last week, however, WeTransfer lowered its revenue target by 20%, bringing the amount sought to 125 million euros. The startup’s estimated valuation at 716 million euros ($799 million).

CEO Gordon Willoughby said in a statement that it was a difficult decision to call off the IPO, especially with investor interest so high, but the company plans to continue with its growth plans and other measures aligned with its strategy, Reuters reported.

See also: WeTransfer looking for an IPO in Amsterdam

“WeTransfer has demonstrated a strong track record of profitable growth,” Highland Europe partner Irena Goldenberg, which owns a 55% stake in WeTransfer’s parent company, WeRock, told Reuters.

She added that Highland will continue to help WeTransfer grow and believes there may be a possible listing in the future.

WeRock recorded adjusted earnings before interest, tax, depreciation and amortization (EBITDA) of 21.3 million euros on revenues of 72 million euros from January to October 2021.

Read more: Two-thirds of 2021 IPOs now trade below offer price

Founded in 2009 by Dutch entrepreneurs Bas Beerens and Nalden, WeTransfer’s cloud-based software allows users to send large files online. It has 87 million monthly active users in 190 countries and a staff of over 300 people.

“Collaborative games have become a tricky IPO proposition,” Patrick Basiewicz, an analyst at broker FinnCap, told Reuters. “WeTransfer looked solid, but this mistrust, the current market volatility, and the valuation of the offering shouldn’t make the IPO pullback too surprising.”

WeTransfer has other options to consider, with an M&A or future listing being possibilities, a source familiar with the matter told Bloomberg.

TransferWise’s global coordinators were Morgan Stanley and Bank of America. The bookrunners were ABN Amro Bank NV, Oddo BHF SCA and Barclays Plc.

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