Technology
MTN Moves to Sell Jumia Stake Despite Jumia Stock Rising 300%
MTN Plans to Sell Jumia Stake
MTN Group is presently perfecting plans to sell part or its entire stake estimated at $243 million (R4.1bn) in Jumia Technologies despite Jumia shares rising by over 300 percent in the last three months.
According to the people familiar with the deal, MTN is selling its interest in Jumia to pay off its debts and expand into new markets.
It would be recalled that when Investors King first reported MTN’s plan to sell its 19 percent stake in Jumia in May 2019 shortly after Jumia listed on the New York Stock Exchange (NYSE), the 19 percent was valued at $655 million.
However, fraud attacks from Citron Research, a controversial American Research firm, plunged Jumia value to as low as $2.33 per share, down from about $40 per share it traded in April 2019.
Jumia has now gained about 300 percent in the last three months due to speculations that the e-commerce company would have recorded substantial sales during COVID-19 lockdown like its global counterparts.
The parties involved in the sale have not made a final decision, according to a Bloomberg report that quoted people familiar with the deal.