SCHEDULE: General Atlantic Reduces Stake in dLocal Ltd to 28.3%

General Atlantic and its affiliates have filed an amended Schedule 13D, disclosing a reduction in their beneficial ownership of dLocal Ltd's Class A common shares to 28.3% following a secondary offering.

Summary

• General Atlantic, L.P. and its affiliated entities (the 'Reporting Persons') have filed an Amendment No. 2 to their Schedule 13D regarding their beneficial ownership in dLocal Ltd.
• The Reporting Persons collectively beneficially own 46,656,695 Class A common shares of dLocal Ltd, representing 28.3% of the company's outstanding Class A common shares as of June 30, 2025.
• General Atlantic DO B.V. (GA DO), a selling shareholder, entered into an underwriting agreement on September 3, 2025, for the sale of 17,250,000 Class A common shares, including the full exercise of the underwriters' option.
• The secondary offering closed on September 5, 2025, with shares sold at a price of $12.3675 per Class A common share.
• On September 9, 2025, the remaining balance under a Margin Loan Agreement was fully repaid, leading to the release of 30,000,000 Class A common shares previously pledged by GA DO SPV.
• These 30,000,000 released shares are expected to be transferred to GA DO shortly after the filing of this statement.
• The filing updates the beneficial ownership percentages and details the recent secondary offering and the release of pledged shares.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to a major institutional investor reducing its stake, which can create selling pressure and be perceived as a lack of future confidence. However, the release of pledged shares is a positive for the reporting entity, balancing the overall sentiment to a neutral-to-slightly-negative score.

Positives

• The full repayment of the Margin Loan Agreement and the release of 30,000,000 pledged Class A common shares by GA DO SPV reduces financial encumbrances for the General Atlantic group.
• The secondary offering allowed General Atlantic to realize value from a portion of its investment in dLocal Ltd.

Negatives

• General Atlantic's reduction in its stake could be perceived by the market as a decrease in confidence or a strategic exit, potentially putting downward pressure on dLocal Ltd's share price.
• The sale of 17,250,000 shares increases the public float, which might lead to increased selling pressure in the short term.

Risks

• Increased supply of shares in the market from the secondary offering could lead to price volatility for dLocal Ltd's Class A common shares.
• A significant reduction in a major institutional investor's stake might be interpreted negatively by other investors, potentially impacting investor sentiment and future capital attraction.

Future Outlook

The filing indicates that the 30,000,000 Class A common shares released from pledge will be transferred to GA DO shortly after the filing, consolidating ownership within the General Atlantic group following the secondary offering.

Management Comments

• Members of the GA Partnership Committee disclaim ownership of the Class A common shares reported herein except to the extent that they have a pecuniary interest therein.

Industry Context

This filing reflects a common practice for private equity firms like General Atlantic to partially or fully exit investments in publicly traded companies as part of their fund lifecycle. The sale of a significant block of shares in a payments technology company like dLocal Ltd could be driven by portfolio rebalancing or a strategic decision to realize gains, which is a typical event in the investment landscape.

Comparison to Industry Standards

• The reduction of a significant stake by a major institutional investor like General Atlantic is a standard event in the private equity investment cycle, where funds typically seek to monetize their investments over time. This is comparable to exits seen from other growth equity firms in the fintech sector, such as Silver Lake's partial exits from various tech companies or Insight Partners' divestitures.
• The size of the block sale (17.25 million shares) is substantial, indicating a material shift in General Atlantic's exposure to dLocal Ltd, similar to how large institutional investors manage their positions in high-growth companies like Adyen or StoneCo.

Corporate Governance

Stakeholder Impact

• Shareholders: The increased float from the secondary offering may lead to short-term price volatility. The reduction in a major investor's stake could influence investor sentiment.
• Company (dLocal Ltd): The transaction does not directly impact the company's operations or financial position as it was a secondary offering by a selling shareholder, not a primary capital raise.
• General Atlantic Group: The sale allows for capital realization and portfolio rebalancing, while the release of pledged shares improves their financial flexibility regarding their remaining stake.

Next Steps

• The 30,000,000 Class A common shares released from pledge by GA DO SPV will be transferred to GA DO shortly after the filing.

Key Dates

Recommendation

While the reduction in General Atlantic's stake could introduce short-term selling pressure and potentially signal a shift in institutional confidence, it is also a common part of a private equity firm's investment lifecycle. The company's underlying fundamentals are not directly addressed by this ownership filing. Investors should 'hold' and monitor dLocal Ltd's operational performance and future guidance, as well as the market's absorption of the additional shares, before making further investment decisions.

Keywords

dLocal Ltd, General Atlantic, Schedule 13D, Beneficial Ownership, Secondary Offering, Share Sale, Institutional Investor, Equity Stake, Financial Services, Payments Technology