Klarna has signed a strategic agreement with Elliott Advisors to fund £30bn of UK transactions through the sale of its short-term, interest-free product receivables.
The agreement involves the ongoing sale of nearly all of Klarna’s short-term, interest-free product receivables in the UK, according to FF News.
The partnership aims to support Klarna’s continuous growth in the UK and enhance its capital management strategy. Klarna will retain ownership of all consumer-facing activities, including underwriting and servicing, while this agreement enables it to fund over £30bn of volume throughout the transaction’s life.
Klarna has been focusing on expanding its capital offloading capabilities over the past three years to accommodate the increasing demands of its global network. By partnering with Elliott Advisors, Klarna will be able to optimise its resources, supporting further growth and improving its capacity to deliver services to both consumers and merchants.
The company is growing rapidly, with over 10m British consumers using its services in the past year, and more than 40,000 UK retailers now offering Klarna, marking a 33% year-on-year increase.
Elliott Advisors (UK) Limited, part of the larger Elliott Management Corporation, is a global investment firm. The company manages multi-asset investment strategies, providing financial advice and capital solutions to support high-growth businesses across various industries.
“This is a unique deal, designed to support Klarna’s global growth as we continue on our journey to become the commerce network for the next generation. By efficiently managing our assets, we can deploy shareholder equity more effectively to meet the growing demand for Klarna’s products and services for both consumers and merchants globally,” Klarna chief financial officer Niclas Neglén said.
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