By Supantha Mukherjee, Anirban Sen and Anna Irrera
STOCKHOLM/BENGALURU/LONDON (Reuters) - Swedish payments firm Klarna is in talks with investors for a new round of funding which would value it at more than $10 billion, three sources said, as it attempts to expand its business in the United States.
At that valuation, Klarna, whose service allows shoppers to buy online through its merchant partners and settle their dues in instalments using its "buy now, pay later" (BNPL), would nearly double its previous peak of $5.5 billion in August 2019.
But the privately-owned Swedish company will still be valued at less than its rival, Australia's AfterPay (AX:APT), which has a market capitalisation of about $15 billion.
Klarna plans to raise just over $500 million from a mix of old and new investors, two of the sources told Reuters, adding that a deal will likely be announced in the coming days.
A spokeswoman for Klarna, which was founded in 2005 and already counts Sequoia Capital, Bestseller, Dragoneer and Commonwealth Bank of Australia (OTC:CMWAY) among its largest investors, declined to comment on its plans.
With about 85 million customers and 235,000 merchant partners, Klarna has been expanding in the U.S. and Britain.
"BNPL" companies have seen rapid growth as customers turned to online shopping during coronavirus lockdowns.
Klarna's gross merchandise volume (GMV) - the value of transactions made using its payment platform - has risen to $22 billion in the first half of the year.
It said https://fr.reuters.com/article/klarna-results-idCNL4N2FS20T last month that the U.S. will soon become its largest market, where it will also file for an initial public offering (IPO) within the next two years.
Klarna's latest funding round is likely be its last before a potential IPO, one source said, adding that the firm is likely to start talks with investment banks to help with preparations for a listing over the coming months.