Buy Now Pay Later (BNPL) lender Afterpay Touch (ASX: APT) has completed a capital raising of more than $300 million to fund its global market expansion, at the same time as its co-founders sell down their stock.

The company emerged from a trading halt on Tuesday to unveil the capital raising and today announced the successful completion of a fully underwritten institutional placement of 13.8 million ordinary shares at $23 per share – above the $21.75 floor price – to raise $317.2 million.

Meanwhile, Afterpay disclosed three directors including co-founders Anthony Eisen and Nicholas Molnar as well as group executive David Hancock would sell down their stock concurrent with the placement.

The market can often respond negatively to this as investors may consider this move as a company executive’s lack of confidence in the stock.

However, the sell-down of 2.05 million shares each from Mr Eisen and Molnar and 400,000 from Mr Hancock has been allocated to US cornerstone investors Tiger Management and Woodson Capital.

Tiger is a private equity giant with investments in businesses including music streaming platform Spotify and payment software company Square.

In addition, Mr Eisen and Mr Molnar will remain as Afterpay’s largest shareholders with their shareholdings representing an estimated 8.1% of issued capital.

The co-founders, together with Mr Hancock, have also confirmed their intention to remain as investors in the company and said they will not sell any further shares for at least four months after the placement.

Strong investor support

Afterpay director Elana Rubin said the company was pleased by the strong investor support shown in the capital raising.

“The placement was oversubscribed and we are also pleased to welcome several new high-quality institutions onto our register,” she said.

The raised funds are earmarked to accelerate Afterpay’s mid-term (three-year) strategy, which involves scaling its global infrastructure with a specific focus on growing gross merchandise value (GMV) in the US, completing its launch in the UK and continuing to invest in the Australian and New Zealand market.

Afterpay said it is targeting GMV, or underlying sales, in excess of $20 billion per annum by the 2022 financial year.

In addition, the company said another share purchase plan to raise $30 million is set to follow, with Australian and New Zealand shareholders entitled to subscribe for up to $15,000 worth of Afterpay shares.

The market has responded positively to today’s announcement with Afterpay shares up 6.12% at $25.65 by afternoon trade.