Philippine Long Distance Telephone (PLDT) has agreed to invest 333 million euros (US$445.06 million) for a 10 percent stake in Germany-based incubator, Rocket Internet, with the aim to develop online and mobile payment products in emerging markets.
The largest telco in the Philippines, PLDT said the investment is a long-term commitment to the German company and will see both companies jointly develop mobile and online payment technologies and services in emerging markets. "The partnership will leverage PLDT's experience and intellectual property in mobile payments and remittance platforms, [as well as] Rocket's global technology platform, to provide products and services for the 'unbanked, uncarded and unconnected' population in emerging markets," the company said in a statement Thursday.
PLDT, through its mobile subsidiary Smart Communications, offers several mobile payment tools locally and internationally including online money transfers, banking, and security. In 2013, Smart's mobile money system processed transactions valued at 3.4 billion euros (US$4.54 billion).
As part of the agreement, the Philippine telco will be issued new Rocket shares of the same class and same rights as current investors. It will also have one seat on the German's company nine-member supervisory board.
PLDT CEO and President Napoleon L. Nazareno said in the statement: "Rocket has developed a unique platform for establishing new Internet companies and a proven track record in successfully rolling out these businesses in fast growing markets. We expect the partnership to have a pronounced positive impact on our organization."
Founder and CEO of Rocket Internet, Oliver Samwer, added: "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 and accelerate the delivery of those solutions around the world."