MTN Group has sold its stake in Jumia, one of Africa’s largest eCommerce firms.
The South African telecommunications giant, said it is making a net proceed of $142.31 million from the sale. This sale is part of the telco giant’s effort to streamline its portfolio and decrease debt by selling off its non-core businesses.
MTN had announced in August 2020, that it had plans to sell off its 18.9% stake in Jumia and telecom tower company, IHS towers. As of that time, MTN said it had not taken a final decision. But MTN said it has now filed with the New York Stock Exchange to prepare for a secondary sale of its shares.
A statement from MTN said, “We are proud to have been a partner in the evolution of one of Africa’s pioneering online marketplace businesses and will continue our relationship with Jumia through ongoing operational partnerships in some markets.”
Jumia listed on the New York Stock Exchange in April 2019, becoming the first African tech company to list on the New York Stock Exchange. Its shares soared to a $2 billion valuation. But the losses, a short-selling article from Citron, and issues with partners saw the stock crash.
Six months later, Jumia had lost its unicorn status and its shares sold for as low as $3 at the start of the pandemic.
In March, Rocket Internet sold off its entire stake in Jumia. However, Rocket Internet failed to reveal the details of the deal. Jumia’s stock rose 142% in the months after the pandemic and briefly regained its unicorn status.
However, MTN’s announcement in August made investors uncertain. Jumia’s shares fell again to single-digits when it released its financial results.