IKEJA, Nigeria — Jumia Technologies said Mastercard has agreed to invest €50 million ($56 million) in a private placement ahead of the Africa-focused online retailer’s planned initial public offering in New York.
The US credit card giant joins shareholders such as French drinks maker Pernod Ricard, which bought a 5.1 percent stake for €75 million in December, and largest investors MTN Group and Rocket Internet.
The Pernod deal valued Jumia at about €1.4 billion, making the Amazon-like firm a rare African unicorn (a private company valued at more than $1 billion). It is selling 13.5 million American Depository Shares at $13 to $16 each, according to a filing last week, which could raise as much as $216 million.
The move by Mastercard increases the chances of a successful share sale for loss-making Jumia, which has about 4 million customers across 14 African countries. Founded by French entrepreneurs Sacha Poignonnec and Jeremy Hodara, the group is tapping into rising internet availability in Africa as well as a lack of desirable items such as designer watches and sunglasses.
Mastercard also agreed to a new partnership to help Jumia grow its operations, Berlin-based Jumia said in an emailed statement on Monday. The US credit card giant “has been rapidly expanding its presence and partnerships in Africa, bringing new technologies,” Elcin Yanik, a marketing executive at the Purchase, a New York-based company, said in the same statement.
By Loni Prinsloo; editors: Rebecca Penty, John Bowker and Kim Robert McLaughlin.