Nigeria’s leading online retailer, Konga is set to become Africa’s biggest internet company as an investment of about $60 million is set to be injected into the company.
According to a source close to the retailer, Konga’s value will rise to about $190 million post the capital injection.
But while the new investment speaks volume of investors’ confidence in Konga, founded by Sim Shagaya who also owns DealDey, and online shopping and daily deals,major rival in the online retail space in Nigeria, Jumia may not be having the best of times.
Its mother company, Rocket Internet had its IPO held last week, but the company’s shares had already fallen 13 percent on the Frankfurt Stock Exchange. The fall regardless, Rocket’s IPO remains the largest German tech IPO in the past decade, with the company now valued at €6.7 billion ($8.5 billion).
While Jumia and sister company Kaymu, both backed by Rocket Internet are expected to continue doing well in Nigeria, a market with a large consumer base, Konga might have just been empowered by the new cash injection to further strenghten its position and probably expand to other markets across Africa. Since its launch in 2012, the online retailer has remained focused on the Nigerian market, where it has recorded massive success and growth.
Naspers, which already holds a 50 percent stake in Konga is suspected to be the new investor, with the new investment of about $60 million expected to raise its stake above the current 50 percent. Swedish investment company AB Kinnevik is another investor in Konga, with $25 million injected into the Nigerian internet company earlier this year.