valU, the Egypt-based buy-now, pay-later (BNPL) fintech platform, has struck a $12.4 million funding deal with the Saudi-based Alhokair Family, which runs the popular Alhokair Fashion Retail.
The deal will lead to Fawaz Abdulaziz Alhokair, Salman Abdulaziz Alhokair, and Abdul Majeed Abdulaziz Alhokair, together known as the Alhokair Family – to acquire a 4.99 percent equity stake in the fintech startup, the venture said.
The latest round of funding will take the valuation of ValU to $247.4 million.
The deal is subject to relevant regulatory approvals and satisfaction of certain pre-agreed conditions.
The transaction marks Alhokair Family’s first investment in a BNPL platform in Egypt.
It also acts as a key steppingstone for the platform to create strategic regional partnerships.
The transaction comes on the heels of valU’s entry into the Saudi market last week through a joint venture (JV) deal with FAS Finance.
The JV will have FAS Labs holding 65 percent stake, and the company remaining 35 percent stake.
The launch of FAS Finance and the strategic partnership bring a lifestyle-enabling solution to Saudi shoppers, with valU offering greater affordability and value for customers, all available through one digital platform.
“The transaction is a testament to valU’s visible success story, business model, and potential for growth in Egypt and on a regional level,” said Karim Awad, Group CEO of EFG Hermes Holding, which supports valU.
“We are proud to have grown a strong brand like valU that, since late 2017, has not only established itself as the leading BNPL platform but has also attracted the interest of the world’s largest retailer, Amazon, and now one of the region’s most prominent retail players, Alhokair,” Awad added.
The latest funding-cum-strategic deal will help the fintech platform to be present across Alhokair’s retail network of more than 1,000 stores, as well as online on the VogaCloset and monobrand websites, including 14 in Saudi Arabia.
It will also extend to other vendors, retail networks, and merchants to include and cover the entire Saudi market.
valU is a fast-growing fintech platform in the MENA region that serves more than 574,000 app clients in Egypt.
The company said in its home country, it serves over 5,000 points of sale locations catering to hundreds of thousands of customers transacting in home furnishings, electronics, home appliances, fashion, auto spare parts, healthcare, education, and travel, among a wide array of other services.
Alhokair Family’s agreement to acquire a stake in the company signals its interest in the non-bank financial institutions (NBFI) space in Egypt and puts it on the map as a leading innovator and exporter of financial inclusion solutions.
Last month, EFG Hermes Holding and Amazon entered into an option agreement whereby Amazon agreed to acquire $10 million in EFG Hermes GDRs with the option to replace that investment into valU at a future date, translating into a stake of 4.255 percent of the issued share capital of valU.
With a current footprint spanning 13 countries across four continents, EFG Hermes Holding (EGX: HRHO.CA – LSE: EFGD) has grown over 38 years to transform from a pure-play investment bank in MENA into an impact-driven universal bank in Egypt with the leading investment bank franchise in frontier emerging markets (FEM).
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