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By Geoffrey Smith
October 2, 2014

It was supposed to be a banner moment for Germany, with two hotly-anticipated IPOs breathing new-economy life into a fusty equity market still dominated by familiar old industrial names.

Thanks for the carnage on Wall Street over the last couple of days, it hasn’t quite panned out like that.

Rocket Internet AG, an incubator of e-commerce portals, fizzled on its debut Thursday after pricing its initial public offering at the top end of a pre-announced range at €42.50 a share, giving the company a valuation of €6.7 billion ($8.4 billion). The organizers of the sale had closed the books a week early due to heavy demand from investors. The stock initially fell 9% under pressure from Wednesday’s sell-off in the U.S., but by lunchtime in Frankfurt it had recovered to €41.25, a drop of ‘only’ 3%.

Online fashion retailer Zalando AG, which had floated the day before at a price of €21.50, was less fortunate. Efforts to drive it higher Wednesday quickly ran into selling, and the stock fell another 7.4% by lunchtime Thursday to €19.97.

The declines are all the more stark for the fact that the benchmark DAX index has actually recovered from its earlier weakness, and was up 0.2% on the day by mid-session in Europe.

It’s a far cry from the 38% “pop” in Chinese e-commerce giant Alibaba’s (BABA) share price on the day of its listing. But then the fact is that it’s harder for a stock in the Eurozone to generate excitement when Eurozone retail sales are only growing 0.8% a year, while China’s are growing by 12%.

“We’re not disappointed,” Rocket Internet’s founder and chief executive Oliver Samwer told the German channel NTV. “Our company is long-term oriented and so are our investors. The markets (for e-commerce) are in their infancy and there will be a lot of growth in the coming years.”

 

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