Jumia files for New York IPO as African e-commerce giant seeks funds

Africa’s largest online retailer Jumia started a plan to sell shares in New York as the fast-growing Nigerian firm seeks to take advantage of rising internet access and increasing smartphone use on the continent. The company is seeking a public listing to raise funds and boost awareness, according to a filing on Tuesday. According to Bloomberg News, an IPO would value Jumia at about US$1.5 billion, while largest shareholder while largest shareholder MTN Group Ltd. is looking to raise about $600 million to pay down debt.

Jumia is one of Africa’s 3 unicorns – a private company valued at more than US$1 billion. The retailer provides an Amazon.com Inc.-like service in 14 African countries and has expanded rapidly, with active customer numbers growing to 4 million at the end of 2018 from 2.7 million the previous year.

“We intend to benefit from the expected growth of e-commerce in Africa through the investments that we have made and the extensive local expertise that we have developed since our founding in 2012,” Jumia said in the filing. The company reported a loss of US$192.4 million in 2018, compared with US$186.75 million in 2017.

MTN said at its full-year earnings presentation last week that Africa’s largest wireless carrier had identified Jumia as one of a number of e-commerce assets that could to be sold as part of a 15 billion rand (US$1 billion) asset-disposal plan. The Johannesburg-based company is also looking for buyers for flight-booking site Travelstart-co.za.

Other Jumia shareholders include Goldman Sachs Group Inc., Millicom International Cellular SA, Orange SA and Africa Internet Group, a venture backed by Goldman, MTN and Rocket Internet SE. Banks leading the IPO include Morgan Stanley, Citigroup Inc., Berenberg and RBC Capital Markets.

Source: Bloomberg