Seattle, Washington-based e-commerce giant Amazon.com Inc. (NASDAQ: AMZN) said it agreed to acquire Dubai-based Souq.com, an e-commerce leader in the Middle East. The deal came about after Dubai’s shopping malls operator Emaar Malls made an $800 million counteroffer earlier this week.
Souq.com is the largest online retail and marketplace platform in the Arab world, featuring more than 8.4 million products across 31 categories such as consumer electronics, fashion, health and beauty, household goods, and baby. The platform attracts over 45 million visits per month, with localized operations in the KSA, UAE and Egypt. Souq offers a convenient online shopping experience with secure online payments, option to pay cash on delivery and free returns.
As reported by ExitHub last year, in February 2017 Souq.com raised more than Dh 1 billion ($275 million), bringing its funding total at the time to $425 million, and its valuation to a reported $1 billion. Investors in that funding round included New York-based Tiger Global Management and South Africa’s Naspers Ltd. (JSE: NPN.SJ; LSE: NPSN), both of which had invested in Souq.com in earlier rounds.
“Amazon and Souq.com share the same DNA – we’re both driven by customers, invention, and long-term thinking,” said Russ Grandinetti, Amazon Senior Vice President, International Consumer. “Souq.com pioneered e-commerce in the Middle East, creating a great shopping experience for their customers. We’re looking forward to both learning from and supporting them with Amazon technology and global resources. And together, we’ll work hard to provide the best possible service for millions of customers in the Middle East.”
“We are guided by many of the same principles as Amazon, and this acquisition is a critical next step in growing our e-commerce presence on behalf of customers across the region,” said SOUQ.com CEO and Co-Founder Ronaldo Mouchawar. “By becoming part of the Amazon family, we’ll be able to vastly expand our delivery capabilities and customer selection much faster, as well as continue Amazon’s great track record of empowering sellers.”
“As the largest e-commerce platform in the region, we focus on the value we bring through technology and job creation. We connect people to products through our retail and marketplace model,” said Ronaldo Mouchawar, CEO & co-founder of Souq.com. “Through cutting edge technology, we enable our consumers to make smarter choices and access to mobile commerce is further empowering them.”
The deal is expected to close in 2017 subject to closing conditions, Amazon said.
Souq.com was founded in 2005 as an auction site linked to internet portal Maktoob, which had been founded in 1998 by Samih Toukan and Hussam Khoury as a webmail service. Mouchawar, who was born and raised in Aleppo, Syria, was educated in the U.S. and returned to the Middle East, joining Maktoob in 2000. He holds a Master’s degree in Digital Communications and a Bachelor degree in Electrical and Computer Engineering from Northeastern University in Boston.
Maktoob was acquired by Yahoo in 2009, becoming its official arm in the MENA region. Following Maktoob’s acquisition, Toukan and Khoury decided to spin-off the brands that were not acquired by Yahoo, namely souq, cashu, and ikoo and to form the Jabbar Internet Group, a new incubator to house these brands, focusing on consumer e-commerce in the region. Jabbar currently employs over 300 people at various offices in UAE, Jordan, Saudi Arabia, Egypt and Kuwait, and became one of the leading investors in Internet and technology companies in the region. Jabbar continued to fund Souq.com until it was adequately scaled up.
Photo: Ronaldo Mouchawar, CEO & co-founder of Souq.com.