Swedish payments firm Klarna Bank AB is nearing a deal to raise new money at a slashed valuation of around $6.5 billion, the Wall Street Journal reported on Friday, citing people familiar with the matter.
The deal to raise about $650 million mostly from existing investors led by Sequoia Capital, is yet to be completed and could hit last minute snags, the report added.
In an emailed statement Klarna said, “as always, we do not comment on fundraising nor valuation speculation.”
If the deal is closed at the reported valuation, it would represent a near 86% drop from the $46 billion valuation it had fetched in June last year, when the fintech had raised capital.
In May, Chief Executive Sebastian Siemiatkowski had told Reuters in an interview that the firm was in talks with investors to raise more money and had no plans to go public this year.
Klarna, which is one of the hottest startups in Europe, was widely expected to go public this year, but market volatility following Russian’s invasion of Ukraine has held back its plans.