Africa Internet Group and AXA, a worldwide provider of insurance and asset management, have announced a partnership whereby AXA will become the exclusive provider of insurance products and services through Jumia and other AIG online and mobile platforms in Africa.
In a statement released by AXA, ”Going forward, AXA’s African insurance companies plan to propose custom-made insurance products to Jumia and AIG’s e-commerce client base through its ecosystem of marketplaces and classifieds services. As part of the partnership, AXA will also become a shareholder of AIG, along with MTN, Rocket Internet and Millicom. AXA and Jumia view Africa as a fast developing market for financial services and insurance products, benefitting from strong fundamentals such as low penetration rates, rise in middle class, urbanization as well as the youth of its population”.
As a rationale for its decision, Sacha Poignonnec of Jumia said “Internet is creating unparalleled opportunities for consumers and businesses in Africa to connect and do business in a new way. We continue to be very excited about the growth prospects of Jumia and this new partnership will enable us to capture them,”
“We expect Africa’s e-commerce and online businesses to develop rapidly as a result of the strong growth of the middle class coupled with the increasing mobile phone and internet penetration. With Rocket Internet’s extensive background in online business models, MTN as leading mobile carrier with its broad African presence, and now the partnership with AXA in insurance products and services, we are in a great position to continue to innovate and connect businesses to the fast growing consumer demand.”
Commenting on deal, Denis Duverne, Deputy CEO of AXA said “This transaction confirms AXA’s long-term commitment towards the African markets and represents another step in our development on the continent. Africa is home to some of the most dynamic and promising insurance markets in the world and our partnership with Africa Internet Group will enable us to accelerate materially our development by having access to their rich customer base and to their state-of-the-art e-commerce technology. Going forward, we aim to enable African consumers to better access insurance solutions to create sustainable financial well-being throughout their lives and those of their dependants”.
As a result of the transaction, AXA said it will invest EUR75 million and own approximately 8% of the capital of AIG. Completion of the transaction is subject to customary closing conditions, including the closing of the previous investment round, and is expected to take place in the first quarter of 2016 The additional capital contributed by AXA will further strengthen the balance sheet and support AIG’s continued growth.
According to the companies data, Jumia, AIG’s main subsidiary, is currently present in 11 African markets and grew its transaction volume (GMV) by 265% during first 9 months of 2015 to reach Euro 206 million. Jumia is part of broader ecosystem of services providing opportunities for local African businesses to do business with the fast-growing African consumers and middle class. Other services include Kaymu, a leading online shopping community, as well as leading marketplaces in food delivery (Hellofood), travel (Jovago) and leading classifieds in real estate (Lamudi), jobs (Everjobs) and cars (Carmudi).