Jumia, the top e-commerce company in Africa, has taken a significant stride by proposing that Hassanein Hiridjee, the founder and CEO of Axian Telecom, serve on its supervisory board.
This action has sparked controversy, as it is in conjunction with the increasing rumours regarding Axian Telecom’s prospective acquisition of Jumia.
Axian recently upped its stake in Jumia to nearly 10%, fueling market whispers of a possible takeover. This development is bold, reflecting shifting power dynamics in African tech.
Axian Telecom’s rising influence on Jumia
Axian Telecom, which is domiciled in Mauritius and operates in 17 African and Middle Eastern markets, has recently become one of Jumia’s most prominent investors. To establish itself as a significant participant in Jumia’s future, the company has increased its stake to 9.97%.
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The board appointment request results from substantial resignations that have reduced Jumia’s board to below the regulatory capacity, necessitating Hiridjee’s inclusion. Investors’ optimism regarding Axian’s involvement has been evident in the rapid market response, as Jumia’s stock surged to a 52-week high in response to the news.
Speculation on a strategic acquisition
Analysts speculate that Axian is preparing for a strategic acquisition, which is expected to be valued at approximately $500 million. This is consistent with the $600 million bond financing Axian recently obtained, bolstering these objectives. Even though Jumia CEO Francis Dufay has acknowledged ongoing discussions with Axian regarding “synergies,” both organisations are cautious about formally announcing a merger.
Axian’s public interest in incorporating JumiaPay, Jumia’s payment platform, into its broader fintech ecosystem suggests a desire to enhance collaboration, potentially beyond ordinary investment.
Hiridjee’s supervisory role: a game changer?
If appointed, Hassanein Hiridjee will substantially impact Jumia’s strategic trajectory. His membership on the board could facilitate a more comprehensive integration between Jumia and Axian’s fintech and telecom services. By utilising Axian’s infrastructure and capital, Jumia can adapt to competitive pressures from other global and regional actors.
Axian’s involvement indicates a new chapter concentrated on growth and innovation as Jumia strives for profitability following years of challenges.