UPDATE 1-Philippines telecom firm buys into Rocket Internet

Thu Aug 7, 2014 3:48am EDT

* PLDT to spend 333 mln euros for stake in Rocket Internet

* Rocket to issue shares, PLDT to finance from cash, debt

* Kinnevik says owns 21.5 percent after investment (Adds background)

STOCKHOLM, Aug 7 (Reuters) - Philippine Long Distance Telephone Company (PLDT) said on Thursday it was buying a 10 percent stake in Rocket Internet for 333 million euros ($445 million) in cash, valuing the German internet firm and potential IPO candidate at 3.3 billion euros.

Berlin-based Rocket, which is bidding to create the largest internet empire outside the United States and China and has backed start-ups in online fashion, furnishings and travel, hopes the Philippines firm can help it deepen its focus on digital financial technology.

"Financial technology is a key focus sector for Rocket and this partnership will allow us to build on PLDT's world-class innovations in mobile money and micro-payments," Oliver Samwer, founder and chief executive of Rocket, said in a statement.

Rocket Internet will issue new shares and PLDT will finance the investment from available cash and new debt, the companies said.

Rocket Internet was founded in 2007 by brothers Oliver, Marc and Alexander Samwer and is active in 102 countries, making revenue of $1 billion in 2013 via online fashion stores including Dafiti in Latin America and Lamoda in Russia, as well as Jumia for general merchandise in Africa.

The Samwers have raised 3.5 billion euros of funding for Rocket Internet and its ventures, sources say, including from Swedish investment firm Kinnevik, billionaire American industrialist Leonard Blavatnik, JP Morgan Asset Management and retailers such as Britain's Tesco and Germany's Tengelmann and Rewe.

Kinnevik said on Thursday it would own a 21.5 percent stake in Rocket after the investment and that its own book value at the end of June would have been 4.8 billion Swedish crowns ($696 million) higher had the latest value for Rocket been included.

Sources have said Rocket Internet is considering a stock market listing in Frankfurt later this year.

Rocket Internet also helped launch Zalando, Europe's biggest online fashion retailer, which is considering its own stock market listing. Rocket is no longer invested in Zalando, but the Samwer brothers' European Founders Fund still owns 18 percent.

(1 US dollar = 6.8934 Swedish crown) (Reporting by Mia Shanley in Stockholm and Rosemarie Francisco in Manila; Editing by Mark Potter)

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