..Plans Fund Raising From IPO
Yemisi Izuora
e-Commerce giant, Jumia huge loss of $192m (170m euros) in 2018 following difficulties in raising additional funds from its current investors have been identified as reasons behind its decision to list its shares on the stock market in order to keep the business afloat.
Jumia is presently putting together an Initial Public Offer (IPO) in New York this year which will reportedly see the business valued at $1.5 billion, with reports indicating that some of its current investors are set to divest their stake in the business.
The MTN Group, Jumia’s biggest shareholder, is looking to raise up to $600 million from the sale of its shares during the IPO.
According to BrandSpur.ng, mounting losses – Jumia posted a €120.1m loss in 2017 – have also seen questions raised over over its Africa-wide strategy after the company cited challenges such as a robbery at its Kenyan warehouse, which saw merchandise worth $560,000 stolen.
Jumia has also reportedly filed documents in New York in which it declared that it could not guarantee achieving or sustaining profitability in the future.
Interestingly, Konga, another strong player in the Nigerian e-commerce market, is also set for a major listing on the New York Stock Exchange (NYSE) by the last quarter of 2020.
Although yet to confirmed by the management of Konga who, when contacted, disclosed that it will speak when the time is right, confidential sources within the New York bourse have it that the Konga Group is set for an initial public offering that will see the e-Commerce giant valued at about $3.2b.
Mark Jessey, a prominent stock analyst on NYSE had noted that the proposed Konga IPO is a much sought-after one by investors, many of whom have followed within the last eight months the huge strides and trajectory of the business which came under new ownership after the exit of previous majority investors, Naspers and AB Kinnevik.
“There have been significant investments in critical areas of the Konga Group business portfolio including the omni-channel strategy it pioneered, strong physical presence with a growing chain of retail stores, multiple warehouse facilities, a licensed mobile money/fintech platform and a credible logistics arm with which it has solved the problem of delivery.
“These factors have made Konga the pride of potential investors and there is renewed confidence that Konga can re-write the history of e-Commerce in Nigeria and on the African continent,” he concluded.