Axian Telecom, the pan-African telecom group led by Malagasy businessman Hassanein Hiridjee, is considering a full acquisition of Jumia Technologies AG. Africa’s Sixth-Largest Telco began expanding its stake in the company in June.

The telco currently holds a 9.18% stake in the e-commerce company, valued at $52.5 million.

To finance the potential acquisition of Jumia, Axian recently raised $600 million in international bond markets. While a final decision is pending, the company views this potential acquisition as a strategic opportunity to drive growth across Africa. It’s recognised for its strategy of expanding its reach through acquisitions and joint ventures. 

Based in Mauritius, the telco has a presence in markets such as Tanzania, Madagascar, Comoros, Senegal, and Togo. Jumia operates across 11 African countries, including Nigeria, Kenya, Morocco, Egypt, Tunisia, South Africa, Algeria, Senegal, Ghana, Ivory Coast, and Uganda.

Reports suggest Axian has strong confidence in Jumia’s new strategic direction, operations, and expanding logistics network.

Beyond that, the telco has a keen interest in JumiaPay and the potential to grow its fintech products. The company aims to transform Jumia from simply an e-commerce platform into a comprehensive digital payments hub.

Axian’s focus has been on strengthening its presence within Africa’s fintech sector. Its CEO, Hassan Jaber, described the move as a long-term bet on Africa’s digital economy.

 “We believe Jumia’s achievements in digital retail infrastructure and fintech through JumiaPay, as well as its logistics strengths, place it in a position to promote financial and economic inclusion for the communities it serves,” Jaber said in a statement.

 “This unique position makes Jumia a very attractive investment for Axian Telecom and one which is aligned with our core values.”

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Founded in Nigeria in 2012, Jumia is currently valued at around $500 million. It has been publicly traded on the New York Stock Exchange since 2019. If acquired, Jumia could potentially delist.

The e-commerce platform has never demonstrated a path to profitability. While still facing this challenge, its market niche was troubled by strong competition from platforms like Temu. This acquisition could offer it a lifeline.