Zinox Group expands into the e-commerce business as it shockingly acquires Konga in a deal reportedly worth $10m-$15m.
In a report by This Day, the acquisition was approved by the Securities and Exchange Commission (SEC).
The acquisition was confirmed by the Head of Corporate Communications, Zinox Group, Gideon Ayogu.
Ayogu said: “We have always had an interest in Konga and another big one you know very well but our priority was Konga first because of her integrated nature of four quality companies in one.
Konga is a world-class, professionally-run company whose landmark strides in the sector has gone a long way in ushering millions of Nigerians into the ease and convenience of online shopping and boosting the conduct of e-commerce in the country.”
Continuing, Ayogu said: “Today, many Nigerians can attribute their first experience of e-commerce to Konga.com and we are excited to be a part of this remarkable story.
“Many shoppers can also attest to the speed and efficiency in delivery that characterizes Kos-Express, the company’s logistics arm, which is arguably the best in the sector at the moment.
“Our ambition is to up the tempo by revolutionising e-commerce on the African continent, with Konga at the fore-front of this initiative. In addition to positioning the business on a path of profitability in the short term, our long term plans are focused around seeing Konga well established in other African capitals.
“Furthermore, we will be unveiling a lot of new initiatives soon and we advise shoppers and merchants alike to look out for these innovations which will radically reshape the average customer experience of e-commerce in Nigeria and on the continent.”
Zinox Group, which is one of Africa’s biggest technology groups would assume ownership of the e-commerce platform, Konga.com, which remains one of the biggest players in the sector; KOS-Express, the world class logistics arm of the business and KongaPay, the company’s integrated mobile money payment channel with over 100,000 subscribers.
The landmark deal generated reactions from the Nigerian tech community. Mark Zmyslowski, 31, co-founder and former global CEO of Jovago which later became Jumia Travel after it was absorbed by Jumia in 2016, tweeted his thoughts about the acqusition.
For Zmyslowski he saw this coming in 2015. "The slide I was using 3years ago predicting the real winner of Konga/Jumia fight will be Yudala, unless they change their strategy. #justsaying" he tweeted.
Victor Asemota, Co-Founder, Director at SwiftaCorp said "had to check today’s date to see if it was not April 1 when I saw the Zinox acquiring Konga article. All those dissing Yudala when I thought different can now see that Nigeria is a different animal. Let me go and drink some more tea" via his Twitter account.
Here are reactions from social media;
Yudala, which was created in 2015, emerged as the first ever composite online and retail chain, with the concrete ambition of becoming the market leader in trade and commerce on the continent.
The e-commerce company is being touted as an extension of Zinox because of the relationship of its founder and vice president, Nnamdi Ekeh with Zinox boss, Stan Ekeh.
However, Leo Ekeh has said he isn't the owner of Yudala saying the e-commerce company is solely the brainchild of his son.
Despite the acquisition, there will not be a merger between Konga and Yudala. This is according to Tech Point, which reports that both companies will operate as independent units.
Konga is a Nigerian e-commerce company founded in July 2012 by Sim Shagaya. After focusing its operations in just Lagos, Konga expanded to the whole of Nigeria.
In 2013, Konga raised a $10m Series A round from Investment AB Kinnevik and Naspers. A year earlier, the e-commerce company raised a $3.5 million seed round from Kinnevik.
In February 2017, Konga raised additional funding for its operations from longstanding investors Investment AB Kinnevik and Naspers.
Konga founder Sim Shagaya sent a congratulatory message to Konga and Leo Stan Ekeh on Saturday, February 3, 2018.
"I wish you success with @ShopKonga, @LeostanEkeh. Here's to new beginnings!" he tweeted.
Pulse has reached out to Yudala and Konga for further comments.