Ukrainian Genesis acquires OLX across five African markets for developing of its local business Jiji
The largest Nigerian classified ads site Jiji buys out part of African OLX business from Naspers. AIN.UA received this information from Genesis.
What is Jiji
Jiji is a portfolio asset of Ukrainian Genesis. This classified ads site that targets mobile users was launched back in 2016. In 2018, the project sidelined OLX from Nigerian market. Subsequently, OLX closed its local office and its traffic was significantly lower than that of its competitor.
The deal
According to the terms of the deal, Nigerian users of OLX will be redirected to Jiji website. In addition, Jiji has acquired the business of OLX in 4 other countries of the region: Kenia, Ghana, Uganda, Tanzania. Their users will also be redirected to the new site. It is expected that the total number of monthly unique users of the project will reach 8 million.
According to Vladimir Mnogoletniy, co-founder of Genesis and head of the board of directors of Jiji, acquisition of OLX facilitates the creation of one of the largest classified ads sites in the region:
We intend to use this deal to create the largest African classified ads business and open new opportunities for the fast-growing countries of the region with the population of 300 million people. We believe that in the next 2-3 years we will become one of the top 10 classified ads projects by traffic.
The company intends to finalize the deal in April after it gets approved by the regulators. After that, the company will launch redirect to Jiji from OLX Nigeria, OLX Ghana, OLX Kenya, OLX Tanzania, and OLX Uganda.
[quotes_variant_one image=”806259″ author=”Anton Volyanskiy, CEO and co-founder of Jiji:” /]
“We have been developing Africa’s markets for 5 years now and during this time we have built the largest classified ads site in Nigeria: Jiji contains over 1 million active ads with over 6 million unique users (most of whom use an app). Over 50k professional sellers sell on Jiji and over 10k of them are paying users. We are developing the largest Shopping app in Nigeria. In the past 5 years we have been competing with Ringier, Saltside and Olx in the niche of horizontal classified ads in Nigeria, and now we are happy that we are the likely front-runner in this race.
This deal lays a solid foundation for building the largest classified ads site in Africa, world’s last addressable market. After the deal is sealed, Jiji will work across 5 markets with population of 300 million people, and we believe that in 2-3 years we will become leaders on each of those markets. We have a chance to build one of the world’s largest classified ads sites and my team works a lot in that direction.
We believe that this is a landmark deal for Ukrainian IT sector. I am not aware of any other significant deal where an export-oriented e-commerce IT company from Ukraine could compete with global behemoths (much less to make acquisitions of such scale). Olx, in our opinion, is the world’s strongest classified ads business and we are very happy about such an outcome of our joint efforts. This speaks volumes about possibilities of companies from Ukraine to compete globally in such capital intensive business models.”
The money
Genesis did not share the details of the cost of the deal. They only note that the financial side of the acquisition has been secured by Digital Spring Ventures fund. Previously, the fund invested in Genesis and Jiji itself.
According to sources of AIN.UA, the cost of the deal might vary from $1.5 mln to $3.4 mln.
According to estimates of AIN.UA, by now Jiji has received up to $10 mln of investments from various investors. In its turn, Genesis attracted $6 mln from Horizon Capital, EEGF III in 2016. The amount of investment made by Digital Spring Ventures into Genesis is unknown, the round was closed in January 2015.