The lender made the prediction in a letter leaked to The Guardian, which told its workforce the valuation could be achievable based on its estimated 2015 earnings using a price-to-earnings (P/E) multiple used to value shares.
It read: “Wonga is growing significantly, and if this growth continues we would hope our future share value (and therefore the future value of share options granted now) to also increase accordingly over the next few years.”
It said if its growth continued, at a £5.6bn valuation, it would be x15 P/E multiple to its estimated net earnings.
It went on to surmise that if Wonga were valued at 40 times its 2015 earnings of £375m it could achieve a value of £15bn.
In April 2012, when the letter was sent, the company was internally valuing its shares at £8.67 a share.
The letter, which was sent to 10 staff, did warn its employees that the valuation was based on ‘simplified assumptions’ and it could not guarantee the ‘achievability or reasonableness of any future projections’.
Following the circulation of the letter the then chief executive Errol Damelin began preparing the company to float on the stock exchange. Since being caught up in a string of scandals regarding its treatment of customers the company has scrapped its plans to float.
Damelin existed the company in the end of March, days before the payday industry was to be transferred from the governance of the Office of Fair Trading to the Financial Conduct Authority (FCA).
Wonga became the subject of an FCA investigation in June when it was found to be sending threatening letters chasing debts from customers struggling to repay from law firms which it made up.
Four months later Wonga was censured by the regulator for failing to assess its customers’ affordability and was ordered to wipe off more than 300,000 loans in arrears.
According the Guardian, since the order from the FCA on 2 October this year the lender has written to more customers to wipe off further loans.
