Rocket Internet IPO values business at $8 billion

German venture capital firm and startup incubator Rocket Internet AG has set the price range for shares in its IPO at €35.50 – €42.50 ($45.65 – $54.65), thus valuing the company at about €6.2 billion or $8 billion (at the mid-point of the price range).

Analysts expect Rocket’s offering to be the largest IPO in Germany this year.

Rocket Internet AG (Rocket), which was founded in 2007 by the Samwer brothers (Oliver, Alexander and Marc), copies the business models of successful e-commerce companies in advanced economies and re-applies them in emerging markets.

The company is active in over 100 countries, and posted revenue of $1 billion in 2013.

Rocket says it is selling 24% of its stock– 32.9 million new shares – and expects to raise up to €1.48 billion ($1.9 billion), including the option to sell more shares than planned (green-shoe option).

A group of cornerstone investors has pledged to purchase at least €582.5 million’s worth of shares at the offer price.

Samwer Brothers

Mark (left), Oliver and Alexander (right) Samwer own 52.3% of Rocket Internet AG.

The roadshow (bookbuilding) for the IPO starts on Wednesday, September 24th, and shares will commence trading on October 7th on the Frankfurter Wertpapierbörse (Frankfurt Stock Exchange).

Oliver Samwer, Rocket’s CEO, said he will use the funds to make more headway into emerging markets, especially those in Asia and Latin America.

Zalando, a major European online shoe and fashion retailer that Rocket helped launch, is also planning an IPO, which is expected to value the firm at up to €5.6 billion.

The flotations of Zalando and Rocket will turn the three Samwer brothers, who own 52.3% of Rocket and a considerable stake in Zalando, into billionaires.

Morgan Stanley, JPMorgan Chase & Co. and Berenberg Bank are arranging the share sale, while UBS AG, Citigroup Inc. and Merrill Lynch are joint bookrunners.

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