Tyro shares surge 40% in Australian market debut

Tyro Payments shares jumped 40% in the company's debut on the Australian Securities Exchange on Friday after it raised A$287 million ($195 million) from investors.

By Scott Murdoch

Dec 6 (Reuters) - Tyro Payments TYR.AX shares jumped 40% in the company's debut on the Australian Securities Exchange on Friday after it raised A$287 million ($195 million) from investors.

The company, which sells electronic payment machines and payment services via a digital app to businesses, earlier this week priced its shares at A$2.75 each - at the top of the range during an institutional bookbuild.

The shares opened at midday Friday at A$3.30, up 20% from the issue price, before gaining further ground to A$3.50.

The initial public offering (IPO) was a rare success in Australia following the collapse of transactions for Latitude Financials, Property Guru, Retail Zoo and MPC Kinetic since early October.

Uncertain global financial market conditions, due mainly to the long-running Sino-U.S. trade war, were blamed for the deals being shelved.

However, private equity involvement in each of the companies was seen as a factor in keeping prospective investors wary of buying into the transactions.

Tyro's share price performance will be closely watched given financial services and fintech companies have been under increasing regulatory scrutiny in Australia.

Buy-now-pay-later company Afterpay APT.AX recently released an independent report submitted to financial crimes regulator Austrac that found no wrongdoing by the company.

The regulator ordered the report after it found "reasonable grounds to suspect non-compliance" with anti-money-laundering and counter-terrorism financing laws.

Tyro's largest shareholders will be Atlassian TEAM.O co-founder Mike Cannon-Brookes at 13.69%, and Australian investment firm TDM Growth Partners at 13.26%. Neither of those shareholders sold down stock in the IPO.

An updated list of the company's top 20 shareholders published on the ASX on Friday showed those investors hold 67.1% of Tyro.

Tyro's prospectus said it expected to report a fourth straight annual loss in fiscal 2020.

However, it has delivered a compound annual growth rate of 29% in revenue and gross profits since 2014, a recent company presentation shows. Its gross profit is expected to grow about 20% in fiscal 2020 to A$100 million

(Reporting by Scott Murdoch in Hong Kong; editing by Richard Pullin)

((scott.murdoch@thomsonreuters.com +85229126686))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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