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Too much sizzle gives Sezzle $80m headache – The Australian Financial Review

Buy now, pay later tearaway Sezzle is facing a bigger uphill battle than usual to find a price for its $80 million capital raising.



It is understood the deal was mooted to take place at about the $4.60 mark although that’s clearly nowhere near where the shares got to on a red-hot Thursday.
The company’s shares opened trade on Thursday at $4.90 and quickly jumped on no news other than a two-day old trading update.
Rather, it was caught in a BNPL buying wave: Afterpay was up 11.36 per cent on Thursday to $73.50 after Morgan Stanley tipped it to go to $101 on Wednesday night, Zip Co closed up 10.38 per cent to $6.70 and Splitit jumped 6.08 per cent to $1.57.
But none of them came close to Sezzle, which was up more than 50 per cent and was finally halted when 41 per cent higher to $6.95, after this column revealed a raising was on the cards.
The question facing the company and its broker is should they stick to the original $4.60 plan or try and squeeze some more out of shareholders?
Fundies would love to see the deal get done at or around $4.60; the lower the price, the better for the placement’s buyers. They would no doubt be telling Ord Minnett and Sezzle that Thursday’s trading was just hot air from fringe retail investors and not reflective of the company’s true underlying value.
The stats back up their case. More than a third of the gross value traded in Sezzle on Thursday or $29.2 million across 4033 trades was handled by CommSec, according to Bloomberg.
The bottom line is some tough discussions were going late into Thursday night as Sezzle and Ord Minnett tried to figure it all out.
With Sezzle sizzling, you wouldn’t want it to be too expensive and turn it into a fizzer.

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