BERLIN (Reuters) - German start-up investor Rocket Internet is closing down its grocery delivery service Shopwings in Germany due to a lack of cooperation from retailers and regulatory hurdles.
A Rocket Internet spokesman said the business that only launched last year in Berlin and Munich would focus instead on expanding in Australia as well as in Malaysia, Thailand, Vietnam, Indonesia and the Philippines.
Europe's largest Internet company prides itself on needing only 100 days to go from concept to launch of a new firm, establishing dozens of start-ups from online fashion to home furnishings and food delivery since it was founded in 2007.
But it is also quick to pull the plug on unsuccessful ventures as it seeks to preserve the capital it has raised for the companies most likely to grow quickly and become potential candidates for future stock market listings.
Shoppers in Germany have been slow to embrace e-commerce for groceries as the country has a high density of food stores and the dominant discounters Aldi and Lidl have little incentive to push loss-making deliveries.
Shopwings, which offers to deliver groceries from supermarkets like Edeka, Aldi, Lidl and the organic Alnatura chain within two hours, will end the service after July 24.
The Rocket Internet spokesman said German retailers had not shown much interest in cooperating with Shopwings, which has also been hampered by a court ruling that says it has to list ingredients of all the 18,000 products it offers online.
It also said it would have had to make big adjustments to its technical infrastructure to comply with new EU rules that say online payments above a certain limit have to be verified in two steps from November.
On Tuesday, Rocket said it had successfully placed 550 million euros ($604 million) worth of convertible bonds - a third round of financing just nine months after its initial public offering, sending its stock tumbling.
Rocket's shares recovered somewhat on Wednesday, trading up 3.3 percent at 36.88 euros at 1247 GMT, still well below the 42.50 euro price at which its shares were originally priced in early October last year.
Last month, at its first annual shareholder meeting, Rocket won investor support to raise as much as 4.5 billion euros over the next five years to invest in new ventures and increase stakes in its existing start-ups.
(Reporting by Emma Thomasson and Nikola Rotscheroth, Editing by Ros Russell)