Editor’s Note: May 14, 2019
Jumia is getting a crash course in being listed
Africa-focused e-commerce startup Jumia published its first quarter results on Monday, a day earlier than planned, in a bid to reassure the market following fraud allegations made last week by short seller Citron Research.
Citron claims Jumia deceived investors ahead of its listing on the New York Stock Exchange last month by inflating customer numbers, calling it a “fraud”. The allegations – which the company denies – sent its shares down almost 15% Friday, fueling media speculation about how sound the loss-making business is.
It’s attention Jumia can do without, but needs to get used to.
With its new status as a public company comes the intense scrutiny of the market – from demands for transparency around its finances, to greater accountability to shareholders, and media and analyst attention.
This can be unforgiving. Over the weekend Jumia circulated a note by Citibank countering some of Citron’s accusations, but also saying that the company needs to be more transparent about the issues raised.
The startup is also learning how fickle the market can be. It’s stock soared 224% from its $14.50 debut on April 11 to $46.99 on May 1, and has fallen ever since, closing at $24.5 on Monday.
It’s a crash course in what it’s like to be a listed company.
From The Continent
Sudan’s transitional military council and opposition groups on Monday announced they have agreed on a power structure for the country’s transition following the ousting of longtime president Omar al-Bashir in April. The two sides will meet again on Tuesday to discuss the length of any proposed transition and the military-civilian balance of power in transitional bodies. More: Reuters
Zimbabwe’s state-power utility started rolling blackouts on Monday due to insufficient capacity, with households and industry, including the vital mining sector, facing the prospect of being without electricity for up to eight hours a day. The move comes amid the country’s worst economic crisis in a decade. More: Reuters
The Daily Stat
The percentage by which Tanzania’s coffee output could drop next season due to drought. More:Bloomberg
The Global Perspective
Microsoft plans to invest $100m into opening its first development centers in Africa, starting with Nairobi in Kenya and Nigeria’s commercial capital Lagos. The aim is to hire 500 developers across Africa by 2023. More: Bloomberg
Anadarko Petroleum has signed a long-term deal to supply liquefied natural gas from Mozambique to Japan’s JERA and Taiwan’s CPC through its jointly owned Mozambique LNG1 Co. Pte. Ltd. sales entity. Anadarko is in the process of developing a $20bn LNG project in the southern African country, and is expected to make a final investment decision on the venture on June 18. More: Reuters