(Bloomberg) — Elliot Management Corp. squeezed a sweetened deal out of Rocket Internet SE’s founders in their quest to take the German Internet factory private, forcing the company to almost double its previous offer to untangle itself from the activist investor.
Rocket will launch an unconditional public self-tender for 27.7 million of its own shares at 35 euros ($39.53) a share, according to a statement on Tuesday. That’s almost double the 18.57 euros proposed by the founding Samwer brothers in Sept. 2020, when they attempted to take the company private. Elliott took a 15.1% stake in Rocket in December last year.
The transaction keeps the company on a path to delisting without the need to offer remaining investors the same price that Elliott obtained. Rocket said late last year that taking the company off the market gives it the opportunity to “pursue a long-term approach” to decision making. Elliott’s arrival in the Rocket shareholder register had threatened the plan, which came after Rocket failed to replicate initial wins — such as Zalando, now one of Europe’s largest fashion retailers.
“Elliott welcomes Rocket Internet’s actions today as a positive step for shareholders” a representative for Elliott said in a statement. A representative from Berlin-based Rocket didn’t immediately return a phone call seeking comment.
Shareholders will be allowed to tender one Rocket Internet share for every four Rocket Internet shares held. Global Founders, Rocket’s major investor with 62.32% of the share capital, will transfer most of its tender rights to Elliott, which has about 20.22% of the shares. Elliott has agreed to tender most of its rights and return its Rocket shares under the offer.
Rocket soared as much as 30% to 35 euros on Tuesday, giving it a market value of about $5.3 billion. An extraordinary general meeting will be held on Jan. 31 to consider the offer.
(Updates with Elliott comment in sixth paragraph.)
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