Emaar Malls, a unit of Dubai’s biggest listed developer Emaar Properties, plans to expand its geographical footprint in the Middle East and North Africa with the Dh475.5 million ($129.5m) acquisition of the remaining stake in online fashion retailer Namshi, its chief executive said.
The Dubai-listed company, which first bought a 51 per cent stake in Namshi for $151m in 2017 from Rocket Internet's Global Fashion Group, also would like to boost its sales in existing markets of the UAE and Saudi Arabia, Patrick Bousquet-Chavanne told The National. He did not disclose the investments needed to expand Namshi.
“There are three to four countries that are on shortlist and Egypt is one of these countries,” said Mr Bousquet-Chavanne, declining to give a timeline for expansion or reveal the other countries. “We see continued potential to grow faster in KSA.”
Emaar Malls' full acquisition of Namshi comes two years after it made an 11th-hour bid to acquire Souq.com, which was eventually sold to Amazon for $580m in 2017. The e-commerce market is heating up with a number of companies entering this space as consumers shift to online shopping.
Mohamed Alabbar, chairman of Emaar Properties and board member of Emaar Malls, launched his own $1 billion e-commerce platform, Noon.com, with the help of Saudi Arabia's sovereign wealth fund, – the Public Investment Fund – in 2017. The Chalhoub Group, one of the Arab world's biggest franchise operators of luxury brands, partnered last year with UK-based e-commerce platform Farfetch to get a bigger slice of the Middle East's $8bn luxury retail market.
“It is a highly competitive space,” said Mr Bousquet-Chavanne. “We see global competitors entering the fashion world online. We think that there is a unique position for Namshi to be the regional Asos [a British online fashion and cosmetic retailer].”
Emaar Malls, which owns the flagship Dubai Mall, also plans to increase the number of brands beyond the 700 or so on offer as well as boost the number of its active customer base to exceed 1.2 million.
The company is not planning any more acquisitions for the time being and will focus on growing organically, Mr Bousquet-Chavanne added.
"I think with this asset we have to fully develop and exploit all the digital strategy to help as well the development of our physical transformation agenda,” he said.
Emaar Malls' fourth-quarter net profit rose 2 per cent to Dh591m, with revenue growing 8 per cent to Dh1.2bn as the company continued to expand its malls and retail offerings.
Namshi recorded sales of Dh849m in 2018, an increase of 16 per cent from a year earlier.
The latest acquisition will be financed from the company’s own resources, Mr Bousquet-Chavanne added.