Zinox may acquire Jumia

Jumia, one of the major e-commerce players in the African market, appears to be battling severe headwinds after its share price – which once traded at record highs of $59.96 tumbling down and currently trading at less than $5 – prompting speculations of a loss of investor confidence and a surprise takeover by Sub-Saharan Africa’s leading tech conglomerate, the Zinox Group.

Jumia listed on the New York Stock Exchange in April 2019 with an impressive IPO that saw share prices rise to $26 and opened at $14.5.

But, Citron Research released a damning report two weeks later accusing Jumia and devaluing its stock.

The report highlighted discrepancies between investor presentations and SEC filings from Jumia. It accused Jumia’s management of fraudulently inflating order quantities, as well as labeling it a company plagued by inefficiencies.

Jumia has denied any wrongdoing but Andrew Left, founder Citroen Research, made the allegations. Jumia settled out of court for $5m.

However, investors in Jumia seemed to be feeling a lot less confident after the debacle, as Rocket Internet and MTN Group exited.

Several reports and articles in local and international media also detailed how the company which prided itself as the continent’s first unicorn fell from grace and how Jumia’s misadventure had tainted the potential of African e-commerce.

Now, confidential information from a few high-ranking sources suggests that Leo Stan Ekeh is raising shares in Jumia to increase the possibility of an acquisition.

Feelers says the serial digital entrepreneur who pioneered e-commerce in Africa 12 years ago with BuyRight Africa is now replicating that strategy in Ashour Corporation, a prominent telecommunications service provider, located in Dubai, UAE, and, more recently, Konga.

Ekeh purchased Konga, an ecommerce pioneer of the latter day, in a critical stage in 2018, and made it profitable in just three years. This feat was deemed a miracle by industry experts.

Confidential sources claim Ekeh is supporting Konga’s massive investment in technology, logistics with a recent investment of over N4b and other infrastructure, including acquiring the single largest warehouse in Lagos, Port Harcourt, Abuja and Onitsha not too long ago, with the brand also attracting concrete interest from a horde of potential investors.

Sources say that Zinox Chairman, a passionate, but unrestrained, e-Commerce enthusiast is eager to consolidate the brand with a presence under Konga in 15 African countries to realize his great, but silent, ambition to change Africa’s destiny.

Ekeh is believed to be abroad and efforts to reach him proved futile. Gideon Ayogu (Head of Corporate Communications, Zinox Group) stated that although nothing is impossible, it would surprise if the Group was interested in purchasing Jumia. This is especially after the enormous work done by Konga’s new owners and current management to reposition the brand to its current trajectory.

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