Pagaya relocating HQ from Israel to NYC, reverse splitting shares, in hope of attracting US institutional investors
Pagaya relocating HQ from Israel to NYC, reverse splitting shares, in hope of attracting US institutional investors
In a report titled “Strategic Actions to Enhance Marketability of its Stock” the Nasdaq-listed company detailed its plans to relocate from Israel, file on U.S. domestic issuer forms with the SEC, and reverse split its stock, consolidating shares at a range between 1-for-10 to 1-for-15
Israeli fintech company Pagaya is relocating its headquarters to the U.S. In a report titled “Strategic Actions to Enhance Marketability of its Stock” the Nasdaq-listed company announced its plan to "relocate its corporate headquarters to its current New York City office in the first quarter of 2024, as the U.S. is where it conducts its business, generates the majority of its revenue, and where all of its lending partners are domiciled."
Pagaya cited feedback from U.S. institutional investors as the primary reason for this decision, noting a preference for companies adhering to American reporting rules. Pagaya said it expects to begin filing on U.S. domestic issuer forms with the SEC on a voluntary basis as a foreign private issuer beginning with its first quarter 2024 results.
Pagaya's management is mostly already based in the U.S., with CEO Gal Krubiner and the majority of VPs situated there. The two other co-founders are CTO Avital Pardo, who splits his time between Israel and America, and CRO Yahav Yulzari, who is based in Israel. While no additional managerial relocations are anticipated, the company emphasized that its technological center will remain in Israel, where most employees are based.
Pagaya currently employs 450 workers in Tel Aviv and 200 in New York. The company stressed that the move is essentially technical, intended to align with American reporting standards.
According to the company, it also received feedback about its stock prices from institutional investors, who have a preference for higher-priced stocks. To address this, Pagaya plans a reverse split, consolidating shares at a range between 1-for-10 to 1-for-15, aiming to increase the share price to over 10 dollars.
Pagaya, valued at $8.5 billion in its June 2022 public offering, experienced speculative fluctuations shortly thereafter, briefly hitting a $20 billion market cap and becoming the largest Israeli company on Wall Street. The company, which aims to attract more stable investors through the split and alter its image, had a market cap of around $730 million entering trading on Tuesday after falling around 40% over the last month. Its shares were trading up around 15% on Tuesday at the time of writing.
Pagaya also presented its preliminary 2023 financial information on Tuesday, announcing that full-year 2023 Network Volume is expected to exceed the high end of the company’s previously announced outlook range of $8.0 billion to $8.2 billion. Full-year 2023 Total Revenue and Other Income is expected to be in line with the company’s previously announced outlook range of $800 million to $825 million. Full-year 2023 Adjusted EBITDA is expected to exceed the high end of the company’s previously announced outlook range of $65 million to $75 million.
