(Adds more details on Nubank's IPO plans)
Brazilian fintech Nubank, which was valued at $30 billion in a recent funding round led by Warren Buffett's Berkshire Hathaway BRKa.N , has filed for an initial public offering in the United States.
Nubank's filing sets the stage for a blockbuster flotation, which is expected to happen in the coming months, possibly even before the end of the year, a person familiar with the plans told Reuters.
Like other large tech unicorns this year, Nubank is looking to capitalize on a red-hot U.S. market that is showing no signs of slowing down. Companies have already raised an all-time record of over $250 billion through U.S. IPOs this year, according to data from Dealogic.
Nubank is also among a new wave of Latam tech startups that have capitalized on a once-in-a-generation internet boom in the region that has accelerated under pandemic lockdowns as more shoppers move online.
Perks including no fees or minimum balance requirements have added to the appeal of lenders such as Nubank, with the pandemic driving more people to turn to mobile phone apps for banking solutions.
The boom in the use of fintech services across the world has also accelerated dealmaking in the sector -- earlier this year, buy-now-pay-later firm Affirm AFRM.O went public in the U.S. at a valuation of $22 billion, while in August, payments firm Square agreed to buy Australian BNPL firm Afterpay for $29 billion.
Nubank, which disclosed earlier this month it had turned a profit in the first half of 2021 in its Brazilian operations, could seek a valuation of more than $55 billion, Reuters reported in August https://www.reuters.com/business/finance/buffett-backed-nubank-seek-ipo-valuation-over-554-bln-sources-2021-08-25, which would make it the biggest ever IPO from Latin America.
The finance company has also applied to list its Brazilian Depositary Receipts (BDRs) in its home country, with each BDR representing a fraction of Class A ordinary shares, it said.
METEORIC RISE Founded in 2013 by David Velez, a Stanford-educated Colombian, as an issuer of a credit cards that charged no annual fee, the bank has gained more than 40 million clients, launched new financial products including checking accounts and loans, and expanded throughout Latin America.
Nubank is the fastest-growing fintech in Latin America and makes money primarily through interchange fees that is paid by merchants whenever a customer makes a transaction.
The lender has already issued more debit cards than Brazil's biggest bank, Itau, attracting clients that had avoided opening traditional bank accounts. It has also embarked on a wider regional expansion encompassing Mexico and Colombia.
Besides Berkshire, Nubank counts venture capital firms Dragoneer Investment Group, Ribbit Capital and Tencent Holdings Ltd 0700.HK among its investors.
Japanese technology investment giant SoftBank Group Corp 9984.T was also looking to invest in the fintech company in 2019, but the talks fell through, according to recent media reports.
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