Jumia Technologies AG ($JMIA), the African e-commerce giant, has successfully concluded its secondary share offering, raising $99.6 million in gross proceeds just ten days after announcing the sale of 20 million ordinary shares. The transaction, which saw shares priced at an average of $4.95 each, slightly above last Friday's closing price of $4.90, provides a significant boost to the company's cash reserves amid ongoing expansion efforts. The sale attracted notable interest, including a $6 million investment from French liquor and wine maker Pernod Ricard, which acquired 1.27 million ordinary shares, TechCabal, who first broke the news, reported. This capital infusion comes at a crucial time for Jumia, which is projected to report a $65 million loss for the full year 2024, TechCabal added in its report. As of the end of the second quarter, the company's cash position stood at $92.8 million. The additional $99 million raised will substantially strengthen Jumia’s financial standing as it pursues its ambitious growth strategies. When Jumia first announced it would raise fresh capital in early August, CEO Francis Dufay said the fund would be invested in its supply chain network. “The new funding will be used to expand our supply chain network, particularly by enhancing logistics to reach smaller cities and broadening our overall network,” Dufay said. “We also plan to invest in technology, focusing on marketing and vendor technology, which we believe will significantly impact growth. Bottom line, after deep, fundamental, hard work on cost and efficiency, we believe the time is right to shift the cursor towards growing and invest some extra money so we can scale the company faster and break even faster.” Despite missing revenue targets in the second quarter of 2024, investor confidence in Jumia’s potential to conquer the African market remains strong. The company will need to leverage this conviction as it navigates the challenges of scaling its operations across a diverse and rapidly evolving continent. The successful fundraising signals a renewed commitment to its growth agenda, even as it faces the complexities of operating in Africa’s challenging market environment. Jumia has not yet commented publicly on the raise.
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