Sunday - Jun 25, 2017

Rocket Internet’s proposed interim flotation will see the company valued at $7.64 billion


Rocket Internet’s proposed interim flotation will see the company valued at $7.64 billion

Founded in Berlin, Germany, in 2007, Rocket Internet has grown to become one of the largest e-commerce focused venture capital firms and startup incubators in all of Europe if not the World.

Rocket’s founders, the Samwer brothers have made a tremendous impression of the start up scene through a series of successful investments in online giants Groupon, eBay, Facebook and Linkedin through the brother’s uncanny ability to identify successful internet ventures from other countries (often the United States) and replicate them in predominantly emerging markets.

Rocket Internet is now looking to cash in on their success through an initial IPO, expected to raise around $7.64 billion (€6 billion), in market observers predict will be the largest flotation of any company involved in Information and Communication technology in mainland Europe for a several years.

Rocket Internet’s proposed interim flotation will see the company valued at $7.64 billion

Rocket Internet’s Oliver Samwer

Announcing their decision to go for a partial flotation, a spokesperson for the company predicted that shares were expected to fetch anywhere between $45.00 to $55.00. in the likely event that the upper figure being reached, the Samwer brothers, Oliver, Marc and Alexander will become billionaires in their own right, with them holding a joint 52.3 per cent share in the company with their shares being valued at around $4.1 billion (€3.2billion).

According to industry analysts, Rocket anticipates bringing in around $1.9 billion (€1.5 billion) from the midpoint offer with all indications pointing to the fact that the maximum number of shares being placed will reach the maximum target.

Often described by its detractors as a “clone factory”, Rocket Internet have made no secret of their successful practice of adapting successful business models established in the United States high tech industry initially in Europe and later in the World emerging markets. Rocket Internet has consistently focused their activities on three particular market sectors: eCommerce, online marketing and financial services.

Cash raised by the partial flotation will be used to finance Rocket’s continued expansion, either through launching new ventures or increasing the venture capitalist’s equity in companies where they are already strongly represented in order to ensure that they retain majority ownership as the company’s that they have invested in from their founding continue to expand.

This new policy indicates a considerable change of direction from Rocket’s original strategy, based around funding much of the company’s growth through capital injections from outside investors and, until now, a lack of desire to own a controlling interest in the majority of the companies that they invested in.

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