[Convenience Translation. Only the German version shall prevail.]

Extraordinary General Meeting of Rocket Internet SE on Monday, January 31, 2022

Voluntary Report by the Management Board to the extraordinary general meeting on agenda item 1

The Management Board submits the following voluntary report on the reasons for the proposed resolution on agenda item 1. The report is available online as part of the convocation on the Company's website at www.rocket-internet.com/investors/extraordinary-general-meeting (also during the virtual general meeting).

Under agenda item Error! Reference source not found. of the extraordinary general meeting to be held on January 31, 2022, the Management Board and Supervisory Board propose, among other things, to resolve upon:

  • Capital decrease by redemption of shares to be acquired; and
  • Acquisition of own shares in accordance with Section 71 para. 1 no. 6 AktG.

1. Background

Simplified possibility of divestment and repayment of share capital

Following the execution of a public delisting self-tender offer in 2020, the admission of the Company's shares to trading on the regulated market (regulierter Markt) of the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) was revoked, effective as of the end of October 30, 2020 (the "Delisting"). The purpose pursued by the Company with the revocation of the stock exchange listing was, among other things, to pursue a long- term corporate strategy independent of sentiments on the capital market.

The Company has cash and cash equivalents of approximately EUR 279 million.

By acquiring own shares to reduce the share capital through the redemption of these shares yet to be acquired with parallel transferability of Tender Rights, the Company aims to continue to ensure the long-term focus of its investor base in support of its long-term strategy and objectives, to avoid the impact of negative interest rates on its existing cash balance, and to adjust the Company's share capital and financing structure. In addition, acceptance of the repurchase offer will enable the Company's shareholders to disinvest outside the stock exchange at a reasonable price.

2. Existing agreements with shareholders

Against the background described in Section 1 of this report, the Company has entered into a so-called tender agreement (the "Tender Agreement") with its major shareholders, Global Founders GmbH ("Global Founders") and various companies controlled by Mr. Paul E. Singer ("Elliott"), on the date of the convening of this extraordinary general meeting. Under the Tender Agreement, Global Founders has irrevocably agreed to


4853-6144-7942 v.1.1

transfer to Elliott, free of charge, a major portion of its tender rights arising under the Buyback Offer. In return, Elliott has undertaken vis-à-vis the Company and Global Founders to accept the Buyback Offer for all shares held by Elliott in the Company during the tender period of the Buyback Offer after receipt of the tender rights and to transfer the shares held to the Company.

In another agreement entered into on the day of the convening of this extraordinary general meeting, Global Founders has undertaken vis-à-vis the Company not to exercise its tender rights to the extent they are not transferred to Elliott and, accordingly, not to accept the Buyback Offer.

3. Capital decrease by way of redemption and acquisition of own shares under a Buyback Offer

Purpose of the capital decrease

The capital decrease is implemented for the purpose of a partial repayment of the share capital to the shareholders. The Management Board and the Supervisory Board prefer the acquisition of own shares and the decrease of the share capital to the distribution of a dividend from cash on hand, as this allows, in addition to the payout to the shareholders, the aforementioned other purposes in the interest of the Company, in particular the alignment of the investor base with the long-term strategy, to be achieved. These purposes could not be achieved through the distribution of a dividend, as the share capital and thus the shareholder and financing structure of the Company would remain unchanged.

Redemption from the net profits or a freely disposable reserve within the meaning of Section 237 para. 3 no. 2 AktG

The redemption is expected to be charged to the net profits (Bilanzgewinn) or freely distributable reserves (frei verfügbare Rücklagen) within the meaning of Section 237 para. 3 no. 2 AktG, insofar as these are available for this purpose. The redemption shall first be charged to the freely available reserves and, only to the extent that these are exhausted, then to the net profit. An amount equivalent to the amount of the share capital attributable to the redeemed shares will be booked into the capital reserves in accordance with Section 237 para. 5 AktG.

In the course of the implementation process of the Buyback Offer and the cancellation of the own shares to be acquired, the Management Board will examine whether the retained earnings and/or freely available reserves continue to be available to a sufficient extent.

Obligation to redeem

The shares repurchased by the Company on the basis of the resolution pursuant to agenda item 1 must be redeemed. The decision on the cancellation is not at the discretion of the Management Board. The repurchased shares are not available for use for purposes other than their cancellation.


Buyback Offer

The Buyback Offer shall be addressed to all shareholders of the Company.

The acquisition will be made outside the stock exchange by way of a Public Self-Tender Offer (partial offer) to all shareholders (for the tender ratio and the tender rights, see "Tender Ratio and Tender Rights" below).

The acquisition of own shares under the Buyback Offer will be based on a resolution of this extraordinary general meeting on agenda item 1 in accordance with the provisions governing the decrease of the share capital. The registration of the resolution of this extraordinary general meeting with the commercial register of the Company is not a prerequisite for the purchase of own shares nor for the consummation of the Buyback Offer.

Therefore, up to 27,664,079 shares of the Company may be acquired under the Buyback Offer.

Reduction amount

The share capital registered with the commercial register at the time of implementation of the capital decrease will be reduced by a total amount of up to EUR 27,664,079.00, irrespective of other changes in the share capital, through the retirement of fully paid-up shares of the Company still to be acquired in accordance with Section 237 para. 3 no. 2, para. 4 and para. 5 AktG.

The amount of the decrease corresponds to the pro rata amount of the share capital attributable to the shares acquired by the Company in connection with the Buyback Offer (see also item 1.b) of agenda item 1).

The Management Board shall therefore be authorized pursuant to Section 71 para. 1 no. 6 AktG and by consummating the Buyback Offer, with the approval of the Supervisory Board, to acquire and redeem shares of the Company with a pro rata amount of the share capital attributable to them totaling up to EUR 27,664,079.00 within an Implementation Period to be determined by the Management Board and no later no later than by March 31, 2022 as per the resolution on the decrease of the Company's share capital. The Supervisory Board is authorized to amend the wording of Article 4 paras. 1, 2 of the Articles of Association (Registered Share Capital) in accordance with the extent to which the capital decrease has been implemented.

The amount equivalent to the pro rata amount of the share capital attributable to the redeemed shares will be transferred to the Company's capital reserve in accordance with Section 237 para. 5 AktG.


Purchase price per share

The purchase price offered by the Company amounts to EUR 35.00 per share of the Company (the determined price per share of the Company, the "Purchase Price").

In the opinion of the Management Board, the Purchase Price is appropriate.

The Management Board points out that since the Delisting in 2020, there has neither been trading on a German stock exchange in the regulated market nor any trading initiated by the Company in the over-the-counter marked of any stock exchange. To the Management Board's knowledge, the share is only traded in the over-the-counter market of the Hanseatic Stock Exchange Hamburg (Hanseatische Wertpapierbörse Hamburg), without this trading being based on an inclusion application by the Company. Due to the low free float of the Company's shares and the low trading volume of the shares in the over-the- counter trading at the Hanseatic Stock Exchange Hamburg (Hanseatische Wertpapierbörse Hamburg), the Management Board does not consider the current stock market price of the Company's shares to be a suitable benchmark for assessing the appropriateness of the Purchase Price.

The Management Board is of the opinion that the amount of the Purchase Price is in any case covered by the fundamental value of one share of the Company, based on the actual values of the financial assets currently held by the Company. The calculated value of the balance sheet equity as of December 31, 2020 per share amounted to EUR 32.22 (based on standalone financial statements; balance sheet equity after deduction of treasury shares, divided by the number of shares after deduction of treasury shares) and EUR 35.55 (based on consolidated financial statements; equity attributable to the shareholders of the Company after deduction for treasury shares, divided by the number of shares after deduction of treasury shares).

The Management Board also considers the amount of the Purchase Price to be necessary, as in its opinion the Company's shareholders will only exercise their tender rights in full, if the Offer Consideration corresponds at least to the current fundamental value of the Company. In addition, the Purchase Price has been intensively negotiated between the parties in the course of the negotiations of the Tender Agreement and has therefore been tested on the market. Therefore, the Management Board considers the Purchase Price to be necessary to achieve the share tenders of the Company in the amount of the targeted volume of the Buyback Offer and to realize the objectives of the Company pursued with the Buyback Offer.

In the event of a buyback of a maximum of 27,664,079 shares of the Company, the payout volume would amount to EUR 968,242,765.00.

To finance the payment volume, the Company has cash funds of approximately EUR 279 million at its disposal. In addition, the Company indents to sell liquid financial assets.


Acceptance period

The Buyback Offer shall provide for an acceptance period in the offer letter. The date of the publication of the Buyback Offer and the duration of the acceptance period shall be determined by the Management Board with the approval of the Supervisory Board.

In case the extraordinary shareholders' meeting adopts the resolutions as proposed, the Management Board expects the acceptance period to run from the end of January 2022 for four weeks (20 business days).

Tender Ratio and Tender Rights

Each shareholder is entitled to tender rights under the Buyback Offer and thus to the right to participate pro rata of its shareholding in the Company's buyback by registering the tender rights attributable to the shareholding as well as any tender rights of the Company additionally acquired from other shareholders.

The tender ratio for this Buyback Offer is 4:1, i.e. the holding of four shares of the Company - without prejudice to any acquisition of additional Tender Rights - entitles a Company' shareholder to accept the Buyback Offer for one share of the Company (the "Tender Ratio").

The Company's shareholders are entitled to corresponding tender rights, whereby each share of the Company, with the exception of own shares held by the Company, convey a tender right and four tender rights are required to be able to accept the Buyback Offer for one share of the Company ("Tender Rights"). The Tender Rights are transferable.

Trading in Tender Rights

To the extent legally and technically possible, trading in Tender Rights organized by the Company shall be made possible via a platform and shall be established and further developed by the Management Board with the approval of the Supervisory Board. The purpose of such trading in Tender Rights is to enable the shareholders to realize the value of their Tender Rights by selling them to other shareholders without being forced to tender their shares to the Company. Conversely, shareholders wishing to tender more shares than their shareholding ratio would allow will be given the opportunity to purchase additional tender rights. Shareholders who would not be able to tender full shares because of the defined tender ratio may realize the value of the Tender Rights to which they are entitled to by selling them in the course of trading in Tender Rights or, conversely, may acquire additional Tender Rights in order to tender an integral number of shares.

Shareholders have no claim as to the establishment of a trading in tender rights. The shareholders' option to sell the Tender Rights to which they are entitled to other shareholders outside a trading for Tender Rights established by the Company remains unaffected.


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Rocket Internet SE published this content on 21 December 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 December 2021 14:19:08 UTC.