A Canadian teachers’ pension fund now owns a slice of online fashion giant Zalando, with a two per cent stake acquired as part of a larger round of funding.
It’s the latest in a series of investments in online retail for the Ontario Teacher’s Pension Plan, which manages about $125bn in net assets worldwide. Today’s announcement follows a $70m investment in Zalando’s Latin American counterpart Dafiti in September and a lead role in a $400m round for China’s 360Buy in 2012.
Zalando started life in 2008 as a Rocket Internet-backed clone of Zappos. It is now active in 14 European markets and, while yet to turn a profit, reached more than €1.15bn in revenue in 2012. Responding to speculation an IPO is on the way, Zalando Managing Director Rubin Ritter told Reuters today this is more of a “medium-term” option. He added that the company’s current aim is to become profitable, not to expand into new markets.
The deal with Teachers’ occurred as part of a wider capital raise of up to four per cent. Danish fashion magnate Anders Holch Povlsen participated in the round to keep his newly-won stake of 10 per cent. Zalando’s other investors include Investment AB Kinnevik, the European Founders Fund, DST Global, Holtzbrinck Ventures and Tengelmann Ventures. Rocket Internet is no longer a shareholder.
Kinnevik’s latest interim financial report said the company had been valued at €3.2bn ($4.3bn), which would suggest Teachers’ two per cent stake could be worth $86m.
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