One of the largest investors in Rocket Internet, AB Kinnevik has announced that it will be exercising its option to acquire an additional 3.5 per cent in Rocket’s flagship fashion brand Zalando, cementing its position as the company’s largest owner.
The option was part of a deal brokered in October 2012 in which Kinnevik purchased an additional 10 per cent equity of the European eCommerce giant for €287m from fellow investors Holtzbrinck Ventures, Tengelmann and Rocket Internet. The further acquisition announced today brings Kinnevik’s stake to 38 per cent – 29.3 per cent held directly, with 8.7 per cent through Rocket Internet. purchased from the same players.
In Kinnevik’s 2012 end-of-year report Zalando was valued at around €2.8b. Zalando is the largest online player by net revenues in the fashion sector in Europe. The company launched in Germany in 2008 and today operates online shops in 14 European markets.
Betting on Zalando
Although recently Rocket has forged some new investment relationships with the likes of JP Morgan and Summit Partners, Kinnevik remains the major investor in Rocket and its portfolio companies – of the company’s €810m of investments last year, €793m went to Rocket Internet portfolio companies, including eCommerce expansions into emerging markets such as Dafiti in Latin America, Russia’s Lamoda and Jabong in India.
As well as portfolio investments, Kinnevik owns 24.2 per cent of the parent company Rocket Internet. As we previously reported, Kinnevik’s investments in Rocket have increased to an impressive total of €1.1b over the past few years, with the fair value of those shareholdings sitting at €1.6b. The Swedish investors were rewarded with a return of €113.4m last year.