Swedish payments company Klarna announced today that it has raised 300 million SEK in debt, in a bond sale.
The move is a way for Klarna to raise more capital, without diluting existing shareholders. Klarna is now ramping up its operations in the US, were it faces tough competition from Paypal and other american fintech companies.
The bond notes issued this week has a coupon floating interest rate of 4,5 per cent plus three months STIBOR rate (the rate that banks pay when they borrow from each other in the Swedish market).
Since the STIBOR rate is now negative, Klarnas initial interest rate is actually lower than 4,5 per cent – more like 4 per cent according to the company.
“Klarna has historically grown in partnership with our users, merchants and equity investors. We are therefore very proud to also see this strong interest from credit investors. This inaugural transaction marks the first small step to a wider presence in the debt capital markets”, said Hannes Wadell, Klarna’s Treasurer in a comment on Monday.
Since Klarna is now profitable with a turnover well above 1 billion SEK, the company has the option to raise debt instead of equity – an option that many other tech companies probably would find interesting.
During the last few months, raising capital at high valuations for non-profitable startups have become more difficult.