Rocket Internet started trading on Thursday with more of a whimper than a bang.
The German company disappointed on its debut on the Frankfurt stock exchange yesterday as the stock fell almost 5 per cent by mid-afternoon.
It was Europe’s largest internet initial public offering in fourteen years since Deutsche Telekom, raising €1.4bn through the sale of 37.9 million new shares, including 4.9 million from an overallotment option because of strong demand.
The Berlin-based e-commerce investor, which claims to be the world’s biggest incubator, was founded in 2007 and is now active in more than 100 countries. It has made several investments across the Middle East and North Africa region, including UAE-based namshi.com and Egypt-based Jumia. It is known primarily for cloning well-known websites such as Amazon and Pinterest and catering them to local markets. Last year it reported revenues of more than $1bn.
The management team of Rocket Internet avoided journalists after the ringing of the bell, according to a Reuters report. The company’s Mena director, Eyad Alkassar did not respond to phone calls or emails sent by The National.
The German broadcaster N-TV quoted Oliver Samwer, the chief executive and founder of Rocket Internet, as saying: “Our company isn’t interested in the first price, we’re oriented for the long-term.”
Rocket Internet has made investments in seven countries in the region to date. Last year it launched the Middle East internet Group in partnership with the telecoms operator MTN to invest $200m in local internet companies in the region.
So far it has made investments in Easy Taxi, a taxi ordering app; Foodpanda, an online food delivery service; Carmudai, an online marketplace for new and used cards; and Lamudi, a property website.
Rocket Internet’s IPO came days after that of its own company Zalando, Europe’s largest online fashion retailer, which raised €605m, disappointed analysts on debut after closing only €1.50 above its issue price.
There has been a resurgence in IPOs from online companies in recent years, the first of which was Facebook’s $16bn IPO in 2012, which suffered technical glitches on the first day and closed at a value of $38.23, just $0.23 above the IPO price. But one of the most successful was from China’s Alibaba which raised $21.8bn in its flotation on the Nasdaq last month.
Rocket Internet had initially offered its shares in a €35.50 to €42.50 price range.
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