Mastercard has agreed to invest €50m($56m) in Jumia in a private placement ahead of the African online retailer’s IPO in New York. It joins Pernod Ricard, Rocket Internet and MTN as an investor.
The Pernod Ricard deal, which saw it acquire a 5.1% stake for €75m in December 2018 valued Jumia at 5.1%. For Pernod Ricard, Jumia’s 14 country coverage, online and payment platforms, services, logistics infrastructure and market expertise is a key attraction. In particular, Jumia’s strength as a fast food ordering platform (Jumia Food) and its hotel booking service (Jumia Travel) provide new points of access into out-of-home consumption.
The attraction for Mastercard is Jumia’s breadth of services, country coverage and its growing base of 4m customers – most of whom are not credit or debit card owners. The two companies first formed a partnership in June 2017 to develop smoother cashless e-commerce – a big point of friction for internet retailers in sub Saharan Africa, where customers prefer to pay cash on delivery.
