R3 Considers Going Public with IPO

R3 Considers Going Public with IPO

R3, New York-based blockchain software developer which leads a large consortium of financial institutions, is reviewing the possibility of making an initial public offering (IPO) according to sources. As per the sources, R3, which develops blockchain software, might list on a stock exchange or get a private buyer.

The unknown sources claimed that the Wall Street-backed company was in talks with advisers about going public, but there was no final decision. Not just this, there are reports that several buyers had shown interest in R3. The CEO of R3, David Rutter, and the firm’s investors, which includes Intel and Bank of America, will collectively decide on the future ownership of R3.

But then in a public statement, R3 mentioned its intention of not going into details and said,

“We’re not surprised about the speculation given the success of Corda, but an IPO is not a path we’re pursuing at this time. Our mission from the start was to deliver a blockchain solution for the widest possible business community, and any decision we make will have that goal in mind.”

The ecosystem of R3 includes over 200 companies, including giants like Intel, BNP Paribus, Microsoft, Wells Fargo, Deutsche Bank, Bank of Canada and Barclays. Morgan Stanley, Goldman Sachs, and Banco Santander left the consortium in 2016, followed by JPMorgan in 2017. If new investors would come up with radical changes in R3’s upcoming products and features then there is a risk that more members might leave the group. However, the same changes might bring in other members too.

The unknown people, who asked not to be identified, claimed that the company is speaking with advisers about an initial public offering (IPO), although no final decisions have been made because the deliberations are private. One person said that it has also been approached by potential buyers. The course will be decided by the Founder and Chief Executive Officer David Rutter, along with R3 investors.

R3 is working to deploy blockchain applications that could lead to lightning-fast money transfers and loans with new features. Businesses involved with R3 also include ABN Amro Group NV, Bain & Co., Barclays Plc, Bank of New York Mellon Corp. and Deutsche Bank AG.

Depending on who the buyer is, some R3 users may no longer feel comfortable using its software. The company said more than 20 additional banks have begun working with R3 since 2016, even after a few banks left the consortium.

Blockchain technology offers several advantages and is going mainstream. Many firms are figuring out ways to use blockchain. Thus, right now building a blockchain infrastructure can significantly boost the competitiveness of the firm.

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Aayushi Dhawan
Aayushi Dhawan is an avid reader, researcher, crypto writer and a passionate student. While pursuing her graduation in commerce at SRCC, she realized that writing and Finance give her immense pleasure. She is currently pursuing her post graduation in Commerce (Finance) from Department of Commerce, Delhi School of Economics and keeps on exploring the intricacies of research, her biggest strength.