- MTN Group Ltd is planning to sell at least half of its 19% stake in Jumia in a post-IPO market rally.
- Reports say MTN will use the proceeds to pay its debt and enter new markets
- Jumia's shares have tripped since IPO debut and one of the best performing IPOs in New York.
MTN Group Ltd is planning to sell at least half of its 19% stake in Jumia in a post-IPO marketrally to pay its debt and enter new markets, sources told Bloomberg News.
MTN, a major shareholder in the e-commerce site with $655 million interest may decide on the plan after a six-month lock period, an MTN spokesman told Bloomberg News.
“We have a six-month lockup period where we can’t sell our shareholding.”
“Post that period we will apply our minds on what to do with the investment,” Bloomberg quoted the spokesperson.
Investors remain bullish on Jumia
Despite persistent financial losses, investors and analysts remain bullish on the African e-commerce business. According to Bloomberg, Jumia's shares have tripped since IPO debut and one of the best performing IPOs in New York this year.
MasterCardjoined the growing investors in pre-IPO private placement arrangement with $56 million offerings for ordinary shares. Other existing shareholders include French drinks maker Pernod Ricard and Rocket Internet SE.
Jumia's shares closed at $46.99 per share on Tuesday on the New York Stock Exchange (NYSE), according to market data seen by Business Insider Sub-Saharan Africa on Thursday.