(Bloomberg) -- Marqeta, a payments startup backed by Goldman Sachs Group Inc. and Visa Inc., hired underwriters for a planned 2021 initial public offering, according to people with knowledge of the matter.The Oakland, California-based company is working with Goldman and JPMorgan Chase & Co. on the listing, said the people, who asked not to be identified because the information is private. The company may seek a valuation of about $10 billion, one of them said. A valuation hasn’t been finalized and, as with any IPO, could change pending investor feedback.A JPMorgan representative declined to comment, as did James Robinson, a spokesman for Marqeta, and a Goldman Sachs spokesperson.Marqeta, led by Chief Executive Officer Jason Gardner, struck a deal with Uber Technologies Inc. to become its global card-issuing partner, and JPMorgan said in July it would use the firm’s technology in its commercial card business. Marqeta in June added its first independent directors, a move that’s often viewed as a precursor to a foray into the public markets.In May, the company said it raised $150 million at a $4.3 billion valuation. Its other backers include Coatue, Iconiq Capital, Granite Ventures and 83North.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Emerging from nearly a year of battling an economy dragged down by Covid-19 and a rickety financial system, Beijing is realizing what the most important collateral damage has been: consumers. Without their wallets and balance sheets, China’s economic blueprint for the next five years won’t work.That explains why authorities have been talking up consumer protection, household leverage and the risks of fintech lenders. At a State Council meeting last week, boosting consumption – from autos and services to home decoration – topped the agenda. Separately, the banking and insurance regulator pointed to major problems that it’s targeting and would investigate. Among them are high interest fees and problems with online tech platforms, insurance sales and complex wealth management products. Household balance sheets are increasingly indebted, while creditworthiness is weakening.The focus on consumers is understandable. Ultimately, any percentage of some 1.4 billion people who feel poorer or have lost money could undermine the social stability so highly prioritized by the government. Without them, the recovery and future goals will be derailed. The growth strategy unveiled in the new five-year plan depends partly on generating consumer demand. Currently, Beijing has been able only to boost supply.In protecting its hundreds of millions of households, the government wants buyers to know their rights and to empower them – or at least to make them feel that way. It’s a theme taking hold globally. The Group of 20 leaders’ declaration last weekend touched on the subject, while the European Commission has launched a new consumer agenda for citizens to “play an active role in the green and digital transition.”In China, courts are hearing more cases that involve complaints over online shopping for food, electronics and healthcare products. Beijing has a draft personal information protection law in the works that could become the country’s first legislation in safeguarding an individual’s data. The central bank has announced new measures to protect consumers’ rights and fined six state-owned banks for infringing them.The government’s plan involves extending each yuan of household income. While the lending side has taken much of the blame for excesses in the online fintech draft rules, the reality is that consumers and small companies have had their borrowing capped above certain levels. Earlier this month, China loosened restrictions on licensed consumer finance companies to enable lower provision coverage ratios. That would allow them to lend more, and help consumers borrow more. The banks need retail franchises to thrive because the balance sheets of their corporate clients continue to look burdened.It will be a challenge. Beijing has spent $1.3 trillion to lift the economy out of Covid-19. But consumers aren’t ready to spend yet and are holding onto their cash. The household savings rate for the first three quarters of 2020 came in at 37.2% as a portion of disposable income, compared to 32.2% in the same periods in the preceding three years, Morgan Stanley analysts show. Consumption in most sectors isn’t growing, though a recovery is afoot in pockets like autos, where incentives are rising. Retail sales grew last month, but were barely over half their pre-virus levels, according to S&P Global Ratings. Will making consumers feel secure help China battle a problem that it’s faced for years: a falling household consumption ratio? So far, it doesn’t appear so. China’s stands at 39% of gross domestic product, according to Goldman Sachs Group Inc. analysts, compared to 68% in the U.S., where the propensity to consume as well as household disposable income ratios are higher. In China, however, falling disposable incomes are a major factor driving the decline, as is a rise in urban savings. Making each yuan go further won’t solve the problem until consumers either have more money, or feel financially safer. Beijing hasn’t shown it’s helping on this front. One way would be to step up communication and information. Broader protection is commendable and obviously necessary. But a muddled approach doesn’t help, such as restricting online fintech loan facilitators that borrowers want to tap, and forcing action from others like consumer financing companies that are theoretically easier to regulate. Think about the upended initial public offering just suffered by Jack Ma’s Ant Group.Safeguards need to be executed with the right long-term goals in mind and no room for short-term regulatory arbitrage. With the wrong rules, China may be creating room for yet more unwanted behavior.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Anjani Trivedi is a Bloomberg Opinion columnist covering industrial companies in Asia. She previously worked for the Wall Street Journal. For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Russian online retailer Ozon Holdings Plc will raise $990 million in its initial public offering in the U.S., taking advantage of demand for technology stocks amid the busiest fourth quarter for new listings since 1999.Ozon priced 33 million shares at $30 apiece, the company said in a statement Tuesday. This exceeded guidance of $22.50 to $27.50 per share, while the offering size is 10% higher than initially planned. Ozon surged on its first trading day in the U.S. after the IPO. The shares were up 42% to $42.50 at 1:22 p.m. in New York.Ozon plans to use the IPO proceeds for general corporate purposes. Goldman Sachs Group Inc. and Morgan Stanley are managing the sale along with Citigroup Inc., UBS Group AG and three Russian banks. The underwriters have an option to buy as many as 4.95 million shares within 30 days.The listing will contribute to a spate of technology IPOs this year that have raised more than $59 billion globally, according to data compiled by Bloomberg. Ozon’s share sale adds to what’s already been the busiest fourth quarter in the U.S. since 1999, the data show.Ozon is the largest Russian listing since EN+ Group Plc in 2017 and the first Russian business to sell shares in the U.S. since Kismet Acquisition One Corp.’s black-check IPO in August.It comes as investors flock to technology companies in emerging markets, with Polish ecommerce platform Allegro.eu SA raising 9.2 billion zloty ($2.4 billion) in September in Warsaw’s largest-ever listing. The shares have risen 78% since then.Pandemic ShoppingSeparately, existing shareholders Sistema PJSFC and funds managed by Baring Vostok Capital Partners agreed to purchase $135 million of Ozon shares at the IPO price. Their stakes were each about 45% before the IPO, according to the prospectus. The companies said they will own as little as 33% each after the deal and the possible conversion of convertible loans.Ozon, like other ecommerce companies, has seen sales jump during the pandemic as consumers switched to shopping online. The company posted a 70% gain in revenue in the first nine months of the year compared to the same period in 2019.Read More: Polish Online Retailer Allegro Surges 63% in Market DebutOzon started selling books online in 1998 and later expanded to electronics, toys and other items. It competes with Wildberries and AliExpress Russia, a joint venture run by Alibaba Group Holding Ltd. and Mail.ru Group Ltd. Russian internet operator Yandex NV is also expanding into ecommerce.The IPO price valued Ozon at $6.2 billion, including loans and options convertible into shares, Forbes Russia magazine reported, citing unidentified people familiar with the matter.(Updates with share move at the start of trading in the second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.