MTN Group is seeking to sell part or all of its $243 million stake in Jumia Technologies. The biggest African wireless carrier is looking to pay down debt through the sale and enter into new markets, according to sources familiar with the matter.
MTN had previously marked Jumia as a non-core business but has revived plans for a sale after Jumia’s shares surged 142 per cent this year, recovering from a dip in 2019.
The sources, who requested anonymity, intimated that no final decisions have been made regarding the matter.
Jumia, dubbed ‘ Africa’s Amazon’ operates in 14 countries including Nigeria and Ivory Coast where the US e-commerce giant lacks distribution infrastructure.
Jumia is headquartered in Germany and run by its two French Founders, Sacha Poignonnec and Jeremy Hodara. The company dropped way below its Initial Public Offering in 2019 after some improper transactions were discovered in its Nigeria business.
Johannesburg based, MTN, has been disposing off its non-core business assets as parts of the company’s efforts to reduce debt and steer future growth. The company also has a 29 percent stake in IHS towers, the largest mobile telecommunications infrastructure provider in Africa, Europe and the Middle East, which it may sell in the future, the sources said.
MTN has so far generated $812 million through the sale of its assets including towers holdings in Ghana and Uganda to American Towers Inc.
The company’s future plans include a bid to enter the Ethiopian, which is one of the largest markets yet to privatize its telecommunications industry.
MTN is yet to comment on the issue as it is in a closed period ahead of its financial results.