Opera, the inventor of the eponymous web browser and popular consumer internet brand has expanded its ownership of OPay from 6.4% to 9.5%. This occurs after the $127 million sale of Nanobank in 2022.
In exchange for OPay shares from an unidentified PE firm, Nanobank sold the majority of its Asian operations to OPay in February of this year. Before this, Opera, a consumer internet company with its headquarters in Oslo, owned 42% of Nanobank, a lending venture it had created by fusing Opera’s microlending business with Mobimagic’s point-of-sale venture.
As was previously indicated, Opera sold its ownership in Nanobank in 2022 for $127.1 million paid over 8 quarterly installments. Instead of the quarterly cash payments that would have been made until Q2 2026, Opera and the third-party buyer resolved the internet brand’s receivable from the sale of Nanobank earlier this year for OPay shares.
As a result of this all-share deal, Opera now owns nearly 10% of Opay. Opera settled for $35.9 million less than the book value of its investment in Nanobank by selecting OPay shares rather than cash, leaving the internet company with a net fair value of $76.3 million as of year-end 2022. According to the business, this “reflects the underlying fair value of its Nanobank receivable as of year-end,” the company claimed.
The Reason Behind Opera Motive
The transaction’s valuation and an assessment of the worth of Nanobank’s surviving business served as the foundation for the settlement. Opera has accepted the pertinent terms of the sales agreement, including any prospective modifications based on the company’s performance. As a result, Opera will compute the value of its expanded OPay ownership using a weighted set of performance assumptions for the sold company, according to a statement from the company.
It is impossible to tell at what valuation the equity swap was priced because additional terms of the transaction were not revealed. When you consider that Opera sold approximately 30% of its prior ownership in Opay for $31 million in June 2021, two months before it and Mobimagic founded the Cayman Islands-based Nanobank, the story takes an interesting turn.
Opera doesn’t seem to want to keep its ownership of OPay. With the statement that OPay continued its solid growth trajectory through 2022, providing them comfort in the ultimate marketability of our enlarged ownership interest, it has designated its OPay stock as “held for sale”.
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