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Interview: Rocket Internet CEO says ready to pounce with cash pile

Reuters  |  BERLIN 

By Emma and Schimroszik

(Reuters) - Germany's needs to hold on to its mountain of so it can compete with rivals from the and and pounce when investment opportunities arise, the said in an interview.

The investor has a and equity warchest of up to 3.8 billion euros ($4.6 billion), but is under pressure to return part of it to shareholders to boost a stock price that is almost half the level it listed at three years ago.

Oliver Samwer, a who has become one of Germany's richest men through his savvy investments, said wanted to be ready to invest "several hundreds of millions" at once in 2018 or 2019.

"We believe capital is a very important instrument in the tech area. To build firms of a certain size, you need more capital than ever before," told on Wednesday.

He said U.

S. and Chinese firms had access to much more capital.

noted that two years ago investors were concerned that might run out of due to funding so many loss-making start ups and now they were worried it had too much

Founded in in 2007, started out with a focus on ecommerce, but it made a big bet on in 2015, which paid off last year with the listings of its biggest investments HelloFresh and

However, that did little to help Rocket's own share price, with its current market capitalisation of 3.8 billion euros implying that the market puts no value on its assets beyond its and its stakes in the two listed

noted that Rocket's share price has risen more than 10 percent since he spoke to investors in late November, but said he was still not satisfied with the stock, admitting that the company had made mistakes in the past over how it communicates.

"is pursuing a complicated, perhaps also unique business model. Over time, the market will reward this because the figures of our investments are so good," he said.

He said it is not Rocket's plan "at the moment" to consider a delisting and declined to comment on possible new share buybacks after a current 100 million euro programme.

CAUTIOUS MARKET

is invested in more than 100 start-ups, including in financial and property tech, logistics and travel sites, with its stakes in the five biggest of them potentially worth more than 1 billion euros to Rocket, according to

"While we understand that investors may be reluctant to accord a platform value to ... we think the market is taking far too cautious an approach with this company," said Sarah Simon, who rates the stock "buy".

said he was currently focused on Rocket's online furniture sites and Home24, its Jumia business in and the

He said the idea of merging and Westwing, floated by some observers, was a "pure game of make believe". He noted that the sites target different customers and markets.

However, he said consolidation was likely in coming years in the delivery sector, where competes with Just Eat, and

has a team of about 25 staff looking for new opportunities, scanning about 200-300 companies a month.

highlighted lending marketplace Funding Circle, small business financing firm Billie and British home loans agent Nested as companies to watch.

"We are planting new seedlings so we can harvest them in 2020 and beyond," he said. "Small seedlings can suddenly grow big."

($1 = 0.8330 euros)

(Editing by Anna Willard)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, January 11 2018. 16:17 IST
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