Brazil’s Nubank to target market value of more than US$50 billion with IPO in New York

RIO DE JANEIRO, BRAZIL – Nubank will seek a valuation of more than USD$50 billion with its expected initial public offering on the New York Stock Exchange, already including the issuance of BDRs (foreign listed share certificates) in B3.

Founded in 2013 by Colombian David Vélez, Brazilian Cristina Junqueira, and American Edward Wible, Latin America’s largest digital bank, one of the largest in the world, aims to move up to US$3.657 billion with the offering.

There will be 332.523 million Class A shares issued at an estimated price between US$10 and US$11. Class B shares (whose voting power is equivalent to 20 Class A shares) will not be issued and will remain in the hands of the bank’s major shareholders, namely Vélez and Junqueira (learn more about their shares below).

BDRs trading at B3 is equivalent to 1/6 of a Class A share.

If the targeted values are confirmed, Nubank will start as a listed company with a market value of over R$282 billion (at the price of last Friday, November 29). According to this criterion, it will be the largest bank in the country, surpassing Itaú Unibanco (ITUB4), which closed Friday with a market value of R$217.2 billion on the B3. Bradesco (BBDC4), the country’s second-largest bank, has a market value of R$179.3 billion.

The information was disclosed on Monday, November 1, in the IPO filing registered with the SEC (the equivalent of the CVM in the United States).

The documents show that the digital bank had 48.1 million customers in Brazil, Colombia, and Mexico in the third quarter. The monthly average of new customers reached 2.1 million per month, based on data from that period (July to September), 80% to 90% were organic.

The offer includes previously unknown – and interesting for the market – information such as the distribution of the bank’s capital.

Vélez is the main shareholder of Nubank, with 86.2% of Class B shares (corresponding to 75.8% of the bank’s voting rights), followed by Junqueira with 10.7% (and 9.4% of voting rights).