Jumia ($JMIA) has successfully completed its secondary offering of 20 million ordinary shares, achieving its capital-raising goal just a few days after the initial announcement. TechCabal has reviewed a securities filing which reports that the total proceeds from this offering reached $99.6 million.
The data implies an average selling price of roughly $4.95 per share, which is a slight premium over the $4.90 trading price last Friday. Additionally, TechCabal’s recent Monday report highlighted that Pernod Ricard, a distiller of spirits and wine, purchased 1.27 million ordinary shares for an approximate sum of $6 million.
A Wall Street analyst has predicted that Jumia might face a $65 million loss throughout 2024, with its cash reserves reported at $92.8 million in the second quarter of the same year. The successful capital infusion of $99 million is expected to substantially strengthen Jumia’s liquidity. Currently, Jumia has not provided any official comment in response to inquiries about the share sale.
The e-commerce behemoth plans to allocate the newly acquired funds towards accelerating its customer acquisition initiatives, broadening its network of suppliers, and enhancing its distribution infrastructure. Additionally, investments will be channeled into advancing the technology that underpins its vendor services and its marketing division—a supplementary service that has been offered to its clientele since 2021.
Even though Jumia did not hit its revenue projections for the second quarter of 2024, investor confidence in the company’s potential to successfully navigate the African e-commerce landscape remains high. This optimism will be crucial for the company’s continued efforts.
