The Seattle-based e-commerce giant’s acquisition of SOUQ.com, the largest online retail and marketplace platform in the Arab world, is expected to close some time in 2017.
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Amazon has reached an official agreement to purchase Middle Eastern online retailer SOUQ.com.
Amazon.com Inc. has reached an official agreement to purchase Middle Eastern online retailer SOUQ.com, the company said in a statement yesterday.
Financial terms of the deal were not disclosed, but media reports estimated Amazon’s offer to be in the $650 million to $750 million range.
The announcement came amid reports that luxury shopping center operator Emaar Malls had submitted a competing $800 million bid for the Dubai-based e-tailer.
According to Amazon, SOUQ.com is the largest online retail and marketplace platform in the Arab world, featuring more than 8.4 million consumer products like electronics, clothing, and household goods. The e-commerce platform attracts over 45 million visits per month, with localized operations in Saudi Arabia, the United Arab Emirates and Egypt.
The acquisition allows Amazon to enter the Middle Eastern e-commerce market in a major way, but without having to build the required workforce and transportation infrastructure from scratch.
Although it is still subject to customary closing conditions, the transaction is expected to close some time in 2017.
Russ Grandinetti, senior vice president of the international consumer division at Amazon, said the two companies “share the same DNA – we’re both driven by customers, invention and long-term thinking.”
“SOUQ.com pioneered e-commerce in the Middle East, creating a great shopping experience for their customers,” he said. “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,” added 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.”
In addition to having the largest e-commerce operation on the planet, Amazon has been expanding its interest in transportation and logistics services to supplement capacity provided by traditional parcel carriers like UPS, FedEx and DHL. Although the company has consistently denied rumors to the contrary, Amazon’s enormous scale and intense focus on technology and efficiency could allow it to one day compete with those carriers for third-party volumes.