MTN-backed Jumia set for New York IPO as African e-commerce takes off

When Christophe Fofana, a 29-year-old taxi driver and student in Ivory Coast, needed a birthday present for his daughter in 2018, he did something he had not done before. He went shopping online.

Jumia is planning to sell 13.5-million American depository shares at $13-$16, raising as much as $216m. To tackle the issue of vague addresses in many African cities, Jumia has built a network of leased warehouses, pick-up and drop-off locations and brought in a string of delivery partners to ensure reliable service.

The company, which has headquarters in Berlin and got early funding from German start-up incubator Rocket Internet, is not profitable. While the company competes with the likes of Amazon’s Souq.com and Naspers in individual markets, Jumia has said it believes it is the only pan-African e-commerce site.

French drinks company Pernod Ricard, the maker of Absolut vodka, invested €75m in December, giving the firm a 5.1% stake and vaulting Jumia into unicorn territory with a €1.4bn valuation.Prior to the offering, Jumia’s biggest shareholder is SA wireless carrier MTN Group, with a 30% stake, followed by Rocket.The company also largely beat Amazon to the punch in emerging markets, using a New York share sale in 2007 to expand in Latin America, offering shares at $18 each.

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