Payright public offer opens to retail investors following strong pre-IPO support

Payright public offer opens to retail investors following strong pre-IPO support

Payright, Australian-based provider of higher price-point buy now pay later (BNPL) solutions, has opened its initial public offering to raise up to $20m following the recent lodgement of a prospectus with the Australian Securities & Investments Commission.

The offer is underwritten to raise gross cash proceeds of approximately $10 million, with the ability to accept oversubscriptions for a further $10 million, based on an offer price of $1.20 per share. The total number of new shares to be issued by Payright under the offer before oversubscriptions is 8.3m shares. Assuming all oversubscriptions are accepted under the offer, Payright will issue up to 16.7 million new shares at the offer price, for total cash proceeds of approximately $20 million. At completion of the offer, a maximum of 90.3 million shares will be on issue, assuming all oversubscriptions are accepted. The company’s expected market capitalisation at the offer price and before oversubscriptions is $98.4 million, and $108.4 million if all oversubscriptions are accepted.

The public offer is based on a minimum investment of 2,000 shares at the offer price, with applications open until 3 December 2020 (inclusive). Payright’s proposed listing on the Australian Securities Exchange is scheduled for 23 December, 2020. The company completed a pre-IPO funding round over-subscribed, raising $7 million through the issue of convertible notes.

Payright commenced operations in 2016 shortly after being founded by Joint Chief Executive Officers, Myles and Piers Redward. Payright specialises in the provision of both in-store and online BNPL solutions in Australia and New Zealand, with a focus on higher-value, more considered purchases between $1,000 and $20,000. With an average transaction value of around $3,000, the company views its speciality in higher price-point purchases as a key point of difference in a rapidly-growing BNPL sector, with larger transaction sizes lending themselves to a more diversified merchant mix.

Payright has become a provider of choice for approximately 2,400 merchants and more than 33,000 customers across Australia and New Zealand. The company’s merchant partners span a diverse range of industry sectors which are generally under-serviced by the BNPL sector, including:

  • Retail: lifestyle, sports, homewares and outdoor equipment;
  • Home improvement: including solar, internal and external furnishings, flooring, fencing, roofing and trade services;
  • Health and wellbeing: including beauty, fitness and lifestyle, cosmetics, dental, veterinary and audiology;
  • Photography: including photographic shoots, artwork, equipment, printing and services;
  • Education: including online and further education courses; and
  • Automotive: including after-market automotive accessories, tyres, vehicle repairs and servicing.

Payright has achieved significant growth in FY20, with revenue and gross merchandise value (GMV) increasing 188% and 64% respectively. The company’s customer numbers rose by 115% for the same period, and credit arrears remains among the industry’s lowest.

The nature of Payright’s offering, coupled with diligent monitoring of its loan book, has resulted in the majority of the company’s loan volume being attributed to low risk customers. This is evidenced through the typical age profile and employment status of Payright customers, with approximately 73% over the age of 35 years and 71% having stable or permanent employment. Customers identified as homeowners represent the largest segment of Payright’s loan book, and approximately 90% of the loan volume is attributed to high creditworthy customers.

Proceeds from the public offer, together with those from the pre-IPO raise, will help fund the company’s growth strategy as it seeks to leverage its differentiated market offering and build on its strong competitive position.

This includes investing in enhanced digital capability to optimise the customer experience, dedicated merchant and customer acquisition strategies, and an end-to-end e-commerce strategy designed to fast-track the brand’s reach into new and evolving market segments.

Payright Co-Founder and Joint Chief Executive Officer, Piers Redward, said the company had become a provider of choice for a growing number of merchants and consumers seeking BNPL solutions for higher price-point value transactions across industries that were under-serviced by the sector.

“With the majority of BNPL players in Australia and New Zealand focused on the sub‑$1,000 segment of the market, we believe there is significant opportunity and limited competition for higher-value BNPL transactions. The merchant sectors targeted by Payright represent an addressable market of approximately $287 billion, which creates a compelling market opportunity for our business.”

Industry research conducted by Payright indicates that 55% of consumers want a BNPL payment option for purchases exceeding $1,000, and 43% of customers say having a BNPL option at or above this price-point would help them with budgeting.

Payright Co-Founder and Joint Chief Executive Officer, Myles Redward, said Payright’s customer and merchant acquisition strategies, among other initiatives, had positioned the company for ongoing growth.

“We’ve seen compound annual growth of 230% in new customers for the three‑year period to 30 June 2020, along with a sustained increase in active merchants coming onto our network, with the focus shifting in recent quarters to larger, enterprise-level merchants.

Payright will apply to the ASX for admission to the official list of ASX and quotation of shares on the ASX, under the code ‘PYR’, within seven days after the prospectus date of 11 November 2020.

During the offer period, a paper copy of the prospectus is available free of charge to any person in Australia by calling the Payright IPO Information Line on 1300 288 664 within Australia, and +61 2 9698 5414 (outside Australia) from 8:30am to 5:00pm (Australian Eastern time) Monday to Friday (excluding public holidays). The prospectus is also available in electronic form to Australian residents, via the offer website at It is important that prospective investors read the prospectus carefully and in its entirety before deciding whether to invest in the Company.

The offer is being arranged, managed and underwritten by Bell Potter Securities Limited.


Key dates

Prospectus dateWednesday, 11 November 2020
Retail offer opensThursday, 19 November 2020
Retail offer closesThursday, 3 December 2020
Settlement of the offerFriday, 18 December 2020
Allotment of shares under the offerMonday, 21 December 2020
Expected commencement of ASX trading on a normal settlement basisWednesday, 23 December 2020