- Posted by: Unika
- Category: All, Internet
Amazon has finally takeover Souq.com, Online marketplace of Dubai UAE
Amazon confirmed that it has acquired Souq.com, an e-commerce market serving the Center East primarily based out of Dubai, which was already generally described as “the Amazon of the Center East.” We had reported final week that the businesses had already reached an settlement and that “the ink [was] dry” on a deal that was valued at round $650 million. Amazon right now didn’t disclose the worth in a brief assertion asserting the deal, though we’re assured of our sources on the worth we reported.
The announcement caps off a number of months of hypothesis concerning the destiny of Souq. The corporate had initially been in talks with Amazon to accumulate a 30 p.c stake that might have valued that firm at $1 billion, earlier than coming into into negotiations for an outright sale. Others reportedly within the firm included eBay and Emirati retail group Majid Al Futtaim.
Within the final couple of days, Bloomberg additionally reported that Mohamed Alabbar — whose agency owns The Dubai Mall and the Burj Khalifa; a stake in logistics firm Aramex; and is making an attempt to get its personal rival web site Midday.com off the bottom — was additionally within the firm. Nevertheless, it seems like this was little greater than smoke and mirrors, and maybe a late realisation that it’s really tremendous exhausting to get a market off the bottom. Our sources had advised us the deal had already been completed between Amazon and Souq.
Amazon’s acquisition of Souq marks the corporate’s first transfer into serving the Center East area, which covers a complete of some 50 million shoppers throughout a number of international locations, in addition to a comparatively untapped market: solely about two p.c of all retail spend right now is made on-line, in response to a report from McKinsey.
Souq offers Amazon an instantaneous leg up slightly than constructing a brand new service from the bottom up: the corporate contains each a funds and fulfilment infrastructure, together with a market that already has some four million merchandise and works with 1000’s of retailers to assist promote their items on-line.
“Amazon and SOUQ.com share the identical DNA – we’re each pushed by prospects, invention, and long-term pondering,” stated Russ Grandinetti, Amazon Senior Vice President, Worldwide Shopper, in a press release. “SOUQ.com pioneered e-commerce within the Center East, creating an awesome buying expertise for his or her prospects. We’re wanting ahead to each studying from and supporting them with Amazon know-how and world sources. And collectively, we’ll work exhausting to offer the very best service for hundreds of thousands of consumers within the Center East.”
Amazon is treating this as a bolt-on acquisition, bringing on administration and different groups, together with the present Souq.com enterprise.
“We’re guided by lots of the similar rules as Amazon, and this acquisition is a crucial subsequent step in rising our e-commerce presence on behalf of consumers throughout the area,” aded SOUQ.com CEO and Co-Founder Ronaldo Mouchawar. “By turning into a part of the Amazon household, we’ll have the ability to vastly develop our supply capabilities and buyer choice a lot sooner, in addition to proceed Amazon’s nice monitor document of empowering sellers.”
The deal represents an attention-grabbing, if presumably predictable, touchdown for Souq, which was initially based in 2005 however grew to become what we all know it as right now in 2009 when Yahoo acquired an web portal based by Mouchawar known as Maktoob, however was not within the its current e-commerce enterprise.
Souq was valued at round $1 billion in its final funding spherical, so a $650 million price ticket is most definitely a step down from this. Nevertheless, it nonetheless represents a return for traders, who collectively put some $425 million into the corporate. These traders included Ballie Gifford, IFC Enterprise Capital Group, Jabbar Web Group, MENA Enterprise Investments, Naspers, Customary Chartered Financial institution and Tiger World Administration.
Within the years between 2009 and now, Souq has been the most important of a handful of firms to faucet right into a rising class of shoppers who’re turning to the Web and their cellular units to purchase items and companies. Different current firms embody Wadi, which final yr raised $67 million, and Rocket Web-backed Namshi.
The acquisition of Souq is the most recent transfer from Amazon to develop within the normal area. So far, a lot of its strikes in neighboring markets have been natural — that’s, Amazon constructing its worldwide operations from the bottom up slightly than via acquisitions.
Chief amongst them is India, the place the corporate has invested billions to construct out its enterprise within the nation. Simply as Amazon’s transfer to purchase Souq is made partly whereas protecting a watch out for competitors within the Center East, it’s additionally up in opposition to would-be clones and rivals in these different markets, too. In India, the primary competitors comes within the type of two companies, Flipkart and Snapdeal — that are reportedly now speaking a few merger, partly it appears in response to the billions that Amazon is investing in its enterprise there. Flipkart can be being linked with the acquisition of eBay India, though eBay has declined to touch upon rumor and hypothesis when contacted for a remark.
One query now’s whether or not this transfer is a one-off or whether or not Amazon is displaying us that it now has the urge for food to digest extra regional giants, that are patiently ready within the wings for what comes subsequent.