The Management Board of Rocket Internet decided to spend up to €150 million on a program to repurchase senior unsecured convertible bonds due 2022 issued by the company during 2016. Repurchases of convertible bonds under the program may commence immediately and will most likely have a positive impact on Rocket Internet’s stock price. The repurchased convertible bonds will be held by the Rocket Internet or cancelled. The company’s Supervisory Board approved the repurchase program. During this morning, Rocket Internet’s stock price already went up by 5.3%.
The company’s successful divestiture of La Nevera Roja, PizzaBo and other non-core takeaway food businesses at the beginning of February 2016 increased the available funds of Rocket Internet and its portfolio companies by €125 million. In addition, following the launch of the Rocket Internet Capital Partners Fund in January 2016, the company has secured co-funding commitments from third-party investors for new investments resulting in a further improvement of the financial flexibility of Rocket Internet.
Oliver Samwer, the CEO of the Berlin-based company, commented: “Given the significant improvement in financial flexibility we intend to use available funds for the repurchase and thereby reduce interest expenses for the outstanding bonds”, said Oliver Samwer Chief Executive Officer of Rocket Internet. A repurchase of the convertible bonds will also reduce the dilution risk faced by the shareholders”.
Repurchases of the convertible bonds will be carried out using one or more banks based on instructions given by Rocket Internet. The buyback may be suspended and resumed at any time. Rocket Internet will make an announcement once the repurchase program has been completed.