Viva Republica considers tossing local IPO in favor of U.S. listing

Viva Republica, which operates the popular money transfer app Toss and online bank Toss Bank, is mulling a U.S. listing instead of going public on a domestic bourse over concerns of lower-than-expected valuation.

Lee Seung-gun, founder and CEO of Viva Republica, which operates Toss and Toss Bank [VIVA REPUBLICA]

Viva Republica, which operates the popular money transfer app Toss and online bank Toss Bank, is mulling a U.S. listing instead of going public on a domestic bourse.

Viva Republica recently halted its initial public offering (IPO) proceedings, informing its underwriters to suspend the process, the firm confirmed on Wednesday after media reports.

The fintech company, founded in 2013, has been seeking to go public on the domestic stock exchange since earlier this year, and named Korea Investment & Securities and Mirae Asset Securities as lead underwriters and Samsung Securities as a joint underwriter in February.

Viva Republica is currently considering a U.S. listing, according to its spokesperson, but no decisions have been made regarding underwriters, stock exchanges or listing dates yet.

Speculation suggests that the recent suspension of Kbank’s IPO proceedings and the prospect of a lower-than-expected valuation may have discouraged Viva Republica from a domestic listing.

In a pre-IPO back in 2022, Viva Republica was valued at around 8 trillion won ($5.8 billion), while the firm reportedly aims for a valuation of over 10 trillion won.

Kbank, an online bank competing with Toss Bank, suspended its second attempt at an IPO on Oct. 18 due to low demand. The online bank aimed to open subscriptions for a total of 82 million shares at a high price range of 9,500 won to 12,000 won, which was set based on an average price-to-book (P/B) ratio of 2.56 of KakaoBank and overseas internet banks in Japan and the United States.

However, shares of KakaoBank, which went public in 2021, have been trading weak this year, hovering well below its offering price of 39,000 won. Its share price closed at 22,100 won on Wednesday, down 0.45 percent from the previous session, with a P/B ratio of 1.68.

Viva Republica posted an operating loss of 9.4 billion won in the first half of this year, smaller than a loss of 110.8 billion won during the same period last year.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]