PLDT stake in Rocket Internet further reduced
MANILA - PLDT's stake in Rocket Internet, the Germany-based e-commerce incubator and investor it bought a 10 percent stake in earlier this month, has been reduced a second time to 8.4 percent by the entry of a new investor.
The new investor is Holtzbrinck Ventures, which is swapping its stakes in some of Rocket Internet's ventures for a 2.5 percent stake in Rocket itself. In its disclosure to the PSE, PLDT said it "welcomes" the investment.
A week earlier United Internet AG bought a 10.7 percent stake with 333 million euros in cash and by swapping its 102 million euro investment in a partnership with Rocket Internet's controlling family, the Samwer brothers, for shares in Rocket. That reduced PLDT to 8.6 percent.
It was a week before that when PLDT and Rocket announced that the Philippine company bought a 10 percent stake for 333 million euros (P19 billion), saying they would work on mobile and internet payment systems for emerging markets tapping PLDT's Smart Money technology and experience.
Rocket, which is expected to conduct an IPO within the year, describes itself as the leading global internet platform outside the U.S. and China. In the Philippines, it's invested in businesses including Lazada, Zalora, PricePanda, Lamudi, Carmudi and Easy Taxi.
Moody's has said PLDT's investment in Rocket Internet is "credit negative", meaning it's a negative factor when considering PLDT's ability to pay debt because it will reduce cash, even if cash is at P43 billion, and that is P10 billion above recent levels. It also said the investment means exposure to the competitive global internet industry and may signal PLDT's "appetite" for similar deals.
Moody's rates PLDT debt "Baa3", one level above the Philippines' own investment-grade "Baa2" rating. PLDT just raised P15 billion in a bond sale in February.
Yesterday, Globe Telecom President Ernest Cu downplayed PLDT's investment saying it favors its partnerships with companies like Spotify, Facebook. "We didn't have to spend any dollars investing in those companies," he said.