- Explains Why It Went To NYSE For IPO
By Aaron Ukodie
The management of Jumia, today, corrected what it called ‘misconceptions’ in the media about its ownership and why it listed, last week, at the New York Stock Exchange (NYSE) instead of the Nigerian Stock Exchange (NSE).
The company said contrary to reports the African leading ecommerce outfit is an African company, with MTN, the South African mobile phone operator, its major shareholder,” though our founders are largely French”.
“We are an African company, operating in 14 African countries including Nigeria. Our customers are Africans, and every impact we are trying to create is in the African ecosystem”, Dele Awolola, Head of Human Resources said.
Jumia had in its IPO at the NYSE said it is a “Pan-African leader… the only e-commerce business successfully operating across multiple regions in Africa… whose reach and capabilities position it as the preferred partner in Africa for sellers, from individuals to large global brands, and as the preferred shopping destination for consumers”.
Awolola said Jumia had to go to the NYSE for an IPO because the American stock exchange is where global ecommerce companies are listed and it is also that it could improve on its global standing with its competitors. He added” NYSE has knowledge of ecommerce, and large tech companies are there and because Jumia is an African company we are listing it as an entity and not as a Nigerian company”.
According to Awolola, before Jumia went to NYSE it spoke with a number of investors and it concluded that NYSE was the best way to go as it would make the company bigger, better and to provide a better platform for better delivery of service.
He also said that decision to list in the Nigerian stock market in the future would not be “ a single-placed decision, and if there would be need to list in Nigeria in future it would do so.
Jumia, according to Head of Engagement marketing, Olamide Amosun, would continue to make contributions and add to growth of ecommerce in Nigeria.
The company also corrected information about its developer’s status saying that it has Nigerian developers, as well as Africans, and also developers that are from outside of Africa.
Though Jumia, which Chief Financial Officer, Ernest Orumwense today said is not yet profitable but was moving in that direction, had by 2018, according to information available to eWorldNews, a revenue of €130 million. Of the revenue, €66 million came from West Africa, €378 million from North Africa, €15 million from South Africa and €10.8 million from East Africa (Kenya, Uganda, Tanzania, Rwanda – up from €4.6 million in 2017.
Information available on the current status of Jumia before the IPO listing shows that the company has 4 million active customers, 81,000 active sellers, handled 13 million packages in 2018 and had 54% of transactions done on Jumia Pay which they introduced in Nigeria in 2016 and Egypt in 2018.
The shareholders of Jumia, which was incorporated in June 2012, as at December 2018 are Mobile Telephone Networks Holdings – MTN (31.28%), Rocket Internet (21.74%), Millicom (10.15%), AEH New Africa eCommerce I (8.86%), 6.06% each for Atlas Countries Support and AXA Africa Holding, Chelsea Wharf Holdings (5.51%), CDC Group (4.04%), Rocket Investment Funds (3.48%) and Goldman Sachs (2.83%). A new shareholder, Pernod Ricard, came on board investing €75 million cash in January for 7,105 shares which became 5.1 million shares in a capital increase in February 2019 and they are entitled to more shares if an IPO happened within 18 months of their investment.
Information available on the filing document shows that:
- Mastercard Europe SA has agreed to purchase €50 million of our ordinary shares in a concurrent private placement at a price per share equal to the euro equivalent of the initial public offering price per ordinary share.
- Certain of Jumia existing shareholders have the right to subscribe for additional ordinary shares at nominal value depending upon the initial public offering price and the number of shares placed in this offering. Assuming a placement of all offered ADSs at the midpoint of the price range, these existing shareholders may subscribe for 18,157,245 ordinary shares against payment of €18.2 million.
- The chairperson of Jumia supervisory board, Jonathan Klein, has indicated an interest in purchasing an aggregate of up to $1.0 million in ADSs in this offering at the IPO price.
