Africa’s largest media business, Naspers, is closing a deal which will see the company own a $40 million stake in Souq.com, a subsidiary of leading consumer e-commerce sector firm in the Arab World, Al Jabbar Internet Group.
Arabian Business reveals that the agreement between the South African-based company and Middle East’s Al Jabbar, is ready to be announced within the next two weeks, making it the largest internet and e-commerce investment made in the Arabian region since the 2009 sale of Maktoob.com, the largest portal in the Arab world; Yahoo! acquired Maktoob for about $165 million, which now functions as the Arab portal of the world’s second largest search engine.
As at the time of this report, Naspers had not commented on the development.
Chairman and CEO of Al Jabbar, Samih Toukan said earlier in the month that his group was in talks with investors seeking to take a stake in the company which owns Souq.com, the largest ecommerce company in the region.
“We are talking to different investors,” Toukan, who also founded and later sold Maktoob, said. “The interest is there and we’re excited about it. Some of it is from [companies in] the region, some of it is from outside the region and is international,” he added.
E-commerce is now booming in the Middle East with total transactions per year valued at about $11 billion according to analysts. Naspers, a multinational with major stakes in top internet ventures like China’s Tencent Holdings, is cashing in on the opportunity.
“Every month we’re growing at double digits from the month before. Ecommerce is happening now in the Middle East, it’s being conquered, a lot of investment is being put into it,” Toukan had said.
Souq’s competition, Namshi, which sells shoes and clothing in the Middle East, was founded less than a year ago. In August, the online retail store secured a $20 million investment from JP Morgan Chase and Blakeney Management and is now set to expand regionally.