Jumia files for Initial Public Offering in New York

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Jumia, an African e-commerce company of German start-up investor Rocket Internet, announced that it has filed for a New York initial Public Offering (IPO), which could value the firm at $1.6 billion or more.

Jumia was founded in 2012 and offers online shopping, logistics and payment services, but is losing money. The e-commerce company however said its business is expanding, and the continent’s development will make it a better market, with a growing young population, more infrastructure investments, urbanisation and rapid economic growth.

The New York filing did not say how many shares Jumia would sell, nor at what price. Morgan Stanley, Citigroup, Berenberg and RBC Capital Markets are leading the IPO. According to the filing, Jumia was valued at 1.4 billion euros ($1.6 billion) with shares at 14.74 euros in December.

Jumia, which now counts Nigeria as its largest market, makes money both selling its own products, and taking a cut from third-party sales. In 2018, revenues were 130.6 million euros, up from 94 million euros the previous year.

The firm noted that in 2017, the company’s losses rose from 165.4 million euros to 170.4 million euros in 2018. By the end of December, accumulated losses were 862 million euros.

In the IPO prospectus Jumia said that the value of goods sold on its platforms is increasing at a more rapid pace than losses, from 507.1 million euros in 2017 to 828.2 million euros in 2018.

Jumia’s active users, which are considered to be people who buy something at least once in the past year, increased to 4 million at the end of last December form 2.7 million a year earlier.

Rocket Internet owned 21.74 percent of Jumia as of the end of December, while MTN Group held 31.28 percent. Other smaller shareholders include Millicom International, AXA Africa Holding and Goldman Sachs.

 

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