Gargash Group, one of the UAE's biggest privately owned business groups, has acquired digital financial services provider Deem Finance as it seeks to expand its footprint within the financial services sector.
The deal will accelerate the company’s ability to meet its growth plans, Gargash Group said on Sunday.
“This is a transformational transaction that will allow us to reimagine financial services in a way that the success of our brands is aligned with the financial success of our customers,” Shehab M Gargash, managing director and group chief executive of Gargash Group, said.
The value of the deal was not disclosed.
Investments into the financial services sector have been growing amid the Covid-19 pandemic, which accelerated a pivot towards digital payments.
In a survey of 63 companies in the UAE conducted by Mashreq in June this year, nearly 88 per cent said their banking needs had changed as a result of the pandemic, with more than 50 per cent confirming an increased need for financing.
Small companies with annual revenues below $30 million (Dh100m) have been most affected by the pandemic in terms of banking needs, with almost 80 per cent feeling the need for additional financing as result of the pandemic.
Deem Finance, which is based in Abu Dhabi, provides a range of financing solutions, including personal loans, credit cards as well as wholesale deposit products to UAE corporate clients.
The company was previously owned by a partnership between Mubadala Investment Company, Fullerton Financial Holdings, Waha Capital and A A Al Moosa Enterprises.
Gargash Group has had a presence in the non-banking financial services industry for 23 years through Daman Investments.
Daman Investments offers services including asset management, securities brokerage and wealth management. The company also provides investment management and advisory services, through which it helps businesses raise capital to grow their operations.
It also offers advice on mergers, acquisitions and disposals; and underwrites equity and debt capital market transactions, the group said.
“Deem Finance has built a strong product portfolio and has the technological foundation required to launch innovative financial products and services catering to the evolving needs of both individual and corporate customers,” Ahmed Khan, chief executive of Daman Investments, said.
Established in 1918, Gargash Group has a diversified portfolio in automotive, real estate and investments. The company introduced global automotive brands into the UAE such as Mercedes-Benz, Alfa Romeo, GAC Motor and Sixt Rent a Car. It also manufactures an industrial line of lubricants, construction equipment and power systems, the group said.