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BENGALURU : Digital payments major Pine Labs is eyeing a $400 million to $500 million fresh raise as part of the last private funding this year before it hits the US exchanges in 2022, two people aware of the discussions said.

The company is expected to close the round, which will include a primary and secondary raise, in two to three months, the people said, requesting anonymity.

The fundraising is expected to give Pine Labs a valuation of up to $5 billion, a significant jump from July this year when the company closed its $600 million funding from public market investors at a $3 billion valuation.

On Thursday, Pine Labs announced that it raised $100 million from US-based investment management company Invesco Developing Markets Fund. The current fundraising is a part of the $400 million-$500 million, which the company is slated to raise from other public market investors, one of the two persons mentioned above said.

The fundraising values the startup at almost $4 billion, three individuals, including the two mentioned earlier, said.

“Discussions to raise a pre-initial public offering (IPO) fundraise is on. It will tap public market investors for this raise. The funds are likely to be raised to fuel Pine Labs’ international expansion, to shore up currency, and to give an exit to certain early-stage investors before it hits the public markets next year," said one of the persons aware of the discussions.

“The company realizes that there is a significant interest from investors in the market considering its upcoming US listing and its expansion across Asian geographies," the person said.

Pine Labs aims to take its merchant-led payment solutions to West Asia by next year, its chief executive Amrish Rau said in an interview in May.

This year the company expanded its presence in South-East Asian markets through a partnership with card network major and investor Mastercard.

Pine Labs’ expansion plans in Asia included doubling down on emerging economies such as Thailand, the Philippines, Vietnam, and Indonesia. In April, the company also acquired Singapore-based loyalty cashback startup Fave for $45 million, to double down on the Singapore and Malaysia markets.

Through the Fave acquisition, Pine Labs also aimed to launch the platform in India and enter the digital consumer payments business in the country. It also had plans of taking its BNPL (buy-now-pay-later) platform to Singapore and Malaysia through Fave.

Email queries to Pine Labs went unanswered till press time. Rau declined to comment on the matter.

“Pine Labs aims to raise another pre-IPO round in a primary and secondary mix and may aim to use the currency for any potential acquisitions, as well. It is aiming at a valuation between $4 billion and $5 billion for this round," said the second person.

“The company is definitely looking at a pre-IPO fundraise as it aims to bolster its growth in newer markets of Asia and enter newer geographies. With consumer offerings such as payments, loyalty, and BNPL, it will look to turbocharge these categories," said the third person, who also spoke on condition of anonymity.

Pine Labs is powering close to 1 billion online transactions a month, and the number is expected to grow to almost 10 billion in 12 months, Rau said in May.

Pine Labs looks to focus heavily on providing its merchants with online tools, over the next 24 months. It is also expected to launch newer solutions for offline merchants across segments such as invoicing, billing, reconciliations, and settlements.

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