Emaar Malls has snapped up 51 percent of Middle East fashion website Namshi, it announced in a statement to the Dubai stock exchange on Wednesday.
The retail and shopping malls arm of Emaar Properties said it had agreed a strategic partnership with Namshi owner Global Fashion Group (GFG), to grow the Namshi brand in the region and eventually aim for a full sale or public listing.
Under the deal, Emaar Malls will acquire a 51 percent stake in Namshi for $151 million – which includes investment in the company for its future growth, it said – while GFG will retain the remaining 49 percent stake.
Led by co-founders Hosam Arab, Faraz Khalid and Hisham Zarka, Namshi launched in 2012, and offers around 50,000 products across more than 600 international and local fashion brands as well as its own private labels.
The company serves 750,000 customers across the UAE, Saudi Arabia, Qatar, Kuwait, Oman and Bahrain, with a same-day delivery service in the the UAE – where it has its own distribution warehouse in Dubai – and express delivery to Saudi Arabia.
Namshi recorded net revenue of AED555 million ($136 million) in its full year results for 2016, which was its first full year of profitability and positive cashflow.
Under the deal, both partners have agreed on developing jointly the company until a possible listing or full transfer of ownership, Emaar Malls’ statement said.
The Dubai Financial Market (DFM)-listed company added that the partnership would “accelerate Namshi’s development in the region and allow it to continue to flourish as the region’s pre-eminent fashion e-commerce destination”.
Emaar Malls will support the company to access additional fashion brands, further develop its logistics infrastructure and expand its geographical footprint in adjacent countries.
Meanwhile, Namshi will continue to benefit from GFG’s network, expertise in fashion e-commerce and shared resources. Global Fashion Group is part of Rocket Internet and was created by rolling up Lamoda, Dafiti, Namshi, Zalora and Jabong.
The deal is a latest in a string of e-commerce ventures and partnerships in the region, for example the acquisition of JadoPado by a technology fund set up by Emaar founder Mohamed Alabbar, who is also chairman of Emaar Malls and Emaar Properties.
Alabbar said: “The acquisition of a majority stake in Namshi underlines our digital-driven strategy to leverage the growing e-commerce market in the Middle East and North Africa region.
“Namshi offers a perfect fit for Emaar Malls in accelerating its focus on multi-channel retailing, and creating long-term value for its stakeholders.”
Hosam Arab, managing director of Namshi, said: “We are very excited to welcome Emaar Malls as our majority shareholder. We are confident that this partnership will unlock further opportunities and help accelerate the development of Namshi for the benefit of our customers.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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