Exclusive: Laybuy teetering on the edge of collapse as rescue buyer fails to materialise
Buy-now pay-later firm Laybuy is teetering on the edge of collapse after efforts to find a rescue buyer have so far failed, City A.M. understands.
The Kiwi fintech firm, which launched in 2017 and once boasted around 766,000 customers across the UK, Australia and New Zealand, put itself up for sale in April and was looking to delist from the New Zealand’s junior stock exchange Catalist, Morning Wire previously revealed.
However, a buyer has failed to emerge and the company could now be placed into receivership in the coming days, according to an industry source, though it is possible the company could still be sold.
All of its payment products have been unavailable to users since Wednesday, with a statement on its website claiming it is “undergoing maintenance and will be back soon”. Laybuy declined to comment.
Any collapse will threaten around 70 jobs at the Auckland-headquartered firm, which has faced a tough period since raising $80m (£40m) on the Aussie stock market in 2020 at a value of some $358m (£184m).
Last January, the company scrapped its Sydney listing after a slump in its share price and said it would swap to the small business-focused market Catalist.
The fintech currently has a value of around £2.79m on Catalist, which is regarded as a feeder to New Zealand’s Exchange, known as the NZX.
While Laybuy’s active UK customers peaked at around 610,000 in March 2022, that number had slumped to roughly 484,000 at the end the year.
Laybuy removed major retailers like Amazon, Ebay and Marks & Spencer from its platform in April.
Since the firm’s launch seven years ago, the wider BNPL sector has grappled with the threat of tighter regulation across markets and increased competition from incumbent payment firms.
BNPL firms have also been embroiled in a wider slowdown across the tech sector amid rising costs and a dearth of funding.
Swedish fintech Klarna is the UK’s largest BNPL provider with some 18m customers, followed by Clearpay and Zilch. Big banks like HSBC, Natwest and Virgin Money have also attempted to cash in on the boom in demand for interest-free instalment loans.
Moody’s analysts warned in a report last November that “few BNPL companies will remain independent” as some are acquired and others cease operations due to the growing headwinds.