Dubai – The Middle East’s largest online retailer Souq.com and global e-commerce giant Amazon on Tuesday disclosed an agreement that the former will be taken over by the Seattle-based company.
The acquisition is expected to close in 2017. Both the companies did not disclose the value of the deal.
“Amazon’s entry into the region reflects the visionary foresight of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, and Ruler of Dubai, who launched Dubai Internet City in 1999 and adopted the e-commerce and online business legislation of 2002,” said Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai.
While it has been known for a while that Amazon had been trying to gain a foot in the door with its own entry into the region, Souq’s acquisition will help it hit the ground running. Souq.com is the region’s largest online retailer and was hailed as its first unicorn, a company with a valuation of at least $1 billion.
In a media statement, Souq said that joining the Amazon family will enable it to continue growing while working with Amazon to bring even more products and offerings to customers worldwide.
“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.”
“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.”
Earlier this week, it was rumoured that Emaar Malls too was interested in the Dunai-based e-commerce giant, bidding $800 million (Dh3 billion) for Souq.com.
Last week, Financial Times had revealed that Amazon had agreed to buy Souq.com in a deal worth more than $650 million although today’s deal announcement does not disclose the value of the transaction.