FRANKFURT: German venture capital firm Rocket Internet and Zalando, Europe's biggest specialist online fashion retailer, are both on the brink of announcing plans to list on the Frankfurt stock exchange, several sources with knowledge of the matter said.
Both companies want to announce plans for initial public offerings (IPO) in the first half of September, meaning that the two biggest Internet listings in Germany for more than a decade could take place concurrently, the banking sources told Reuters.
"At the moment, the IPO market is still very receptive, but political uncertainties remain," said a banker involved in one of the deals, referring to the conflicts in Ukraine and Iraq. "So everyone is striving to tap the market as soon as possible."
Zalando, which is holding an investor presentation on its business next Thursday, and Rocket Internet are likely to list stakes of around 15 percent each by selling new shares, separate sources have previously said.
Larger offers would risk diluting existing shareholders too much, something they want to avoid, bankers said. One banker estimated Zalando was seeking to raise around 900 million euros ($1.2 billion) and Rocket Internet about 800 million euros.
The companies declined to comment.
"If they really run in parallel, that would be very unfortunate," said a banker involved in the plans, voicing concern that the firms may have to compete for investment.
However, another source with knowledge of the plans said he expected the two companies to attract different kinds of investors, with Rocket Internet appealing more to technology or emerging market funds and Zalando to those looking for exposure to booming e-commerce in Europe.
Rocket Internet plans to use the cash raised in its listing to allow it to hold on to big stakes in the companies it helps create, one banker said.
Buoyant capital markets have encouraged a flurry of e-commerce flotations this year, with Chinese juggernaut Alibaba set to list soon, even though a recent sell-off in high-flying tech stocks has dampened investor appetite.
In the run-up to its listing, Alibaba has been expected to raise more than $15 billion, which would make it one of the biggest tech IPOs in history and close to Facebook's $16 billion initial offering in 2012.
"Investors are basically receptive to these stocks," Commerzbank analyst Heike Pauls said of Zalando and Rocket.- Reuters
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