Quick note on the verdict that just came through on Klarna. The headline amount came in at $1.97B in Klarna’s official press release on the subject (note: this is higher than the $1.5B number coming out of Reuters slightly earlier – we believe the delta to be accrued interest on the initial claim).
The headline figure is very close to our probability-weighted forecast of $1.7B and places us somewhere in between the “stand-alone partial” and “substantial” scenarios which we had discussed:
The Klarna press release clarifies that the $1.97B is the gross amount prior to any leakage (we assume for confidentiality reasons). Based on our waterfall assessment of the claim this equates to 3$ / share on a net basis or ~17% of Klarna’s unaffected share price.
Going through the case has been a fun exercise which we hope you enjoyed!
This catalyst was nowhere to be seen in sell-side reports and the reason why we are here: to provide thoughtful analysis on undercovered, idiosyncratic themes.
We have …