By Modupe Atoyebi
Konga Online Shopping Limited could be preparing its runway for a listing on the Nigerian Stock Exchange (NSE) within the next 3 years, news sources gather.
Working with global investment advisory firms, the largest online shopping omnichannel platform in Nigeria could list its shares in an Initial Public Offering (IPO) as early as 2027, according to experts familiar with the matter.
Strong indications from the leadership of the company show that deliberations are in place and while the details on the timing of the launch could vary, the move to a publicly owned entity appears certain.
The new Konga which was founded in 2018 when Zinox group acquired it 100% from Africa’s largest tech global investors, Naspers and Europe Kennivik, has grown through the years to become a major e-commerce player with more than 700 full-time staff and over 100,000 indirect employees in its portfolio. The acquisition by Zinox Group, a leading tech company, in 2018 was regarded as one of the biggest buyouts of a mainstream e-commerce organisation on the African continent at the time. The company has since positioned itself as a formidable force in the ICT sector.
Speaking with this reporter on the possibility of a public listing, Dr. Chris Uwaje, an expert with a deep understanding of the dynamics in the global capital market as it relates to Tech Companies stated that “Konga is a company which must be watched closely as an organization with the potential to disrupt the Nigerian stock market in 2027 if it hits the NSE as companies like Amazon, Jumia struggle to survive in Africa because of infrastructural issues and are discouraged from meeting their ambitions in Africa.
“As the global economic storm hits Africa, and Nigeria in particular, there are few companies which will emerge in the next 5 years and Konga will break barriers if they hit the stock exchange because these guy’s strategies and tacts are auditable,” he said.
With Jumia’s last quarter result showing reasonable stress and Amazon withdrawing its expansion strategy for Africa, the path for Konga is clear as the only e-commerce company that has everything within its business, from an online marketplace, fintech, hospitality and travels as well as global brand partnerships, to own logistics nationwide. It will cost a fortune to build such a consolidated group in Africa powered by very expensive technologies and complicated analytics.
Konga, best known for its trusted delivery service, began exploring the possibility of an IPO in early 2021, however, it still operates as a privately held entity with active institutional backing. The business is valued at over $ 3 billion considering its direct partnership with major global brands Like Apple, L’Oreal (No.1 Cosmetics company in the world), Starlink owned by Elon Musk’s Space X, Samsung, HP, Lenovo and others who host official stores on Konga.
“Having spent time discussing with investment consultants in Nigeria, I have come to the decision that Konga going on the Stock Exchange will be a win for the country’s business landscape. The organisation’s framework is right for the Nigerian Stock Exchange and the fact that it is committed to driving economic activity within the African subregion should be encouraged,” says Akintunde Badmus, an investment banker based in New York and Lagos.
In many global markets, companies like Konga acquire the services of a special purpose acquisition company (SPAC), through which it lists several businesses over three years. According to two people familiar with the deal, this could be a path the e-commerce service provider may take.
A SPAC deal for Konga will be a significant test of investor appetite for the Nigerian brand as the group undergoes various layers of restructuring to position its portfolio of companies as major stakeholders in corporate trade, fintech, hospitality and cosmetic distribution.
Despite facing global economic headwinds over the past year, Konga has experienced a notable boost in its financial metrics. The company benefits from the leadership of a team of young, yet seasoned professionals, including Prince Nnamdi Ekeh, an MBA graduate from Saïd Business School at Oxford University, known for their acumen and international business expertise.
The Nigerian Initial Public Offering sector worth an estimated N29 trillion is gradually gaining momentum after months of market instability as major manufacturing organizations grapple with tough economic realities.
If Konga succeeds with its entry into the stock market, it will be the first locally owned majority stake e-commerce entity to achieve this feat. Other companies such as Jumia have listed on the New York Stock Exchange with its share value dwindling drastically at 10 percent of its original listing price.
Konga Group may tell the true eCommerce story out of Africa if all goes well.