PLDT invests record P20 B for stake in Rocket Internet

MANILA, Philippines - Dominant carrier Philippine Long Distance Telephone Co. (PLDT) embarked on its biggest overseas investments yet after closing a deal acquiring a 10 percent stake in Rocket Internet AG of Germany worth close to P20 billion.

PLDT chairman Manuel V. Pangilinan said the transaction with the German firm that aims to become the world’s largest Internet platform outside of the US and China is the biggest investment of the PLDT Group abroad.

“Yes with a value of over $400 million,” Pangilinan replied when asked if the acquisition was the biggest foray of the PLDT Group in terms of amount in the overseas market.

Rocket provides a platform for the rapid creation and scaling of consumer Internet businesses outside the US and China. It has more than 20,000 employees in its network of companies across over 100 countries, with aggregated revenues in excess of €700 million in 2013.

Its most prominent brands include leading Southeast Asian e-commerce businesses Zalora and Lazada, as well as fast growing brands with strong positions in their markets such as Dafiti, Linio, Jumia, Namshi, Lamoda, Jabong, Westwing, Home24 and HelloFresh, in Latin America, Africa, Middle East, Russia, India and Europe.

Pangilinan said the investment is the start of a series of acquisition over the next few months. But clarified that the PLDT Group’s focus continues to be on its core businesses in the Philippines.

“I think we must state that the focus of our attention continues to our business here in the Philippines. It is clearly moving towards the data, broadband, and internet space,” Pangilinan said.

According to him, the company is looking at acquiring another Internet company abroad.

 “We are looking at beyond Rocket but nothing definitive as of the moment. The next Internet company that we might invest in would probably be more specialized,” he said.

Pangilinan said the acquisition is in line with the PLDT Group’s “strategy of providing relevant and value-enhancing services to its customers.”

“This new partnership marks a major step forward in the pursuit of our Live Digital! Vision, bringing us even closer to our clients and enhancing PLDT’s innovation capabilities in the digital economy,” he said.

“We will continue to pursue further digital partnerships as one of our key strategic initiatives to drive growth and create value for our stakeholders, whilst leveraging on PLDT’s unique combination of assets,” Pangilinan said.

PLDT president and chief executive officer Napoleon Nazareno said the global strategic partnership between PLDT and Rocket would help drive the development of online and mobile payment solutions in emerging markets.

Nazareno said PLDT’s investment terms reflect its long-term commitment to Rocket and its unique ability to combine PLDT’s world-class mobile money expertise and resources with Rocket’s global platform to drive future value enhancing growth opportunities.

Concurrent with the investment, he pointed out that PLDT and Rocket would jointly develop mobile and online payment technologies and services in emerging markets.

“We are very excited to embark on this journey with Rocket. Our investment demonstrates our commitment to the global internet market and our belief in the powerful synergies between eCommerce and mobile payment, particularly in developing economies,” he said.