African online giant Jumia is heading for Wall Street – which could give MTN a boost
- Jumia has filed to float Initial Public Offering (IPO) on the New York Stock Exchange.
- This gives MTN the opportunity to sell about $600 million (R8.6 billion) in Jumia shares towards clearing its debt.
- Jumia did not state the timeline and share price.
Jumia, Africa’s largest e-commerce platform, has filed for approval from the US Securities and Exchange Commission (SEC) to do an initial public offering (IPO) on the New York Stock Exchange (NYSE).
The public offering will give one of its largest shareholders, MTN the opportunity to sell about $600 million (R8.6 billion) in shares towards clearing its debt.
MTN’s debt increased to R63.6 billion at the end of last year, from R57.1 billion at the end of 2017.
Jumia operates a range of consumer e-commerce operations across the continent, including South African clothing retailer Zando. It has four million unique active African consumers, with 59,000 active sellers.
Last month Techcentral reported that MTN could be selling Jumia in New York at about the same time as an IPO of its Nigeria unit in Lagos, a move the carrier agreed to as part of a $1-billion (R14 billion) regulatory fine in 2016, .
The latter will be done in two stages, with an introductory listing in the first half of this year followed by a sell down of its majority stake, CEO Rob Shuter said recently.
The fillings seen by Business Insider Sub-Saharan Africa on Tuesday confirmed news reports that the African unicorn company is going public.
Jumia did not state the timeline and share price but a report by Bloomberg last month placed its market value at $1.5 billion (R21 billion).
Some analysts believed the listing of Jumia shares on the New York bourse may be a good move for the company, but may not see a good appetite from investors, considering the company's persistent financial losses in its core markets.
In its three-year operating periods, Jumia incurred a loss for the year of €165.4 million in 2017 and a loss for the year of €170.4 million in 2018.
As of December 31, 2018, the e-commerce firm said it had accumulated losses of €862.0 million.
For more, go to Business Insider South Africa.
Receive a single WhatsApp every morning with all our latest news: click here.
Also from Business Insider South Africa:
- It just became much easier to wipe out a bad-debt judgment once you’ve paid up – but you may not want to
- 10 things you need to know about starting a business in SA – from registering your company to paying tax
- 12 easy changes I made to the Galaxy S10 to make it better
- Rupert Murdoch is worth R273 billion and has been married 4 times — here's how he went from operating a small Australian paper to helming one of the biggest networks in the world
- I tried 'Harry Potter: Wizards Unite,' the new game from the creators of 'Pokémon Go,' and it's magical
- A makeup artist shares before and after photos that show how brides transform for their big day