Amazon just announced that it it will be buying 100% of Souq.com.
Souq.com is an English-Arabic language e-commerce platform, often described as the Amazon of the Middle East, and is the largest e-commerce platform in the Arab world. The company was founded in 2005 and stocks 8.5 million items on its website and generates about 50 million monthly visits, according to Chief Executive Ronaldo Mouchawar. It delivers to the six Gulf Arab states and Egypt.
Executives from both firms confirmed the news and agreed on the takeover but did not disclose the value of the Amazon deal.
Goldman Sachs has called it “the biggest-ever technology M&A transaction in the Arab world”. The firm believes the acquisition would accelerate Amazon’s entry into “attractive Middle East countries with significant growth potential.”
Souq.com had a $1 billion valuation last year when it sought funding.
“Amazon is a great fit with us. We have a lot of common values and it is all about innovation, technology and the type of customer experience and thinking that Amazon has,” Mouchawar told Reuters.
“We will continue to invest in our segment and grow our markets,” he also said at Souq.com’s Dubai headquarters.
“We want to figure out how to grow the team here. If we’re going to grow the business we have to grow logistics, we have to grow technical development,” Amazon Senior Vice President Russ Grandinetti said.
So what does this mean for Amazon and Souq.com customers? After Amazon takesover, Middle East consumers will be able to buy products available on Amazon.com through Souq.com, and Middle East merchants will have access to a wider market via Amazon’s network.
The acquisition is expected to close later this year.
Disclaimer: We have no position in Amazon.com, Inc. (NASDAQ: AMZN) and have not been compensated for this article.