The spring of 2020 was a difficult time for many around the world. In the UAE, the health threat posed by the newly emerged coronavirus necessitated the introduction of stay-at-home orders and other forms of social distancing. This led many businesses to develop online services for newly housebound customers, whether for groceries, home deliveries or money transfers.
Three years ago this month, the Careem Super App was introduced, marking an expansion for the Dubai-based company from its beginnings as a ride-hailing service to one with a range of offerings that included car and bicycle rental, utilities payments and food delivery. Careem’s success has been plain to see and the purchase this week by telecoms operator e& of a 50.03 per cent majority share in the Super App for $400 million is a not only a significant development, it is a vote of confidence in the UAE’s business environment.
It is the latest chapter in an Arab success story that has its roots in the Emirates. Careem, founded in 2012, became the Middle East's first unicorn, a start-up with a valuation of at least $1 billion, in 2016 and three years later it was bought by Uber for $3.1 billion. Its adaptability and willingness to branch out and develop new products has not gone unnoticed, with Hatem Dowidar, group chief executive of e&, describing this week how super apps such as Careem’s “catalysed the economic, social and cultural growth of emerging markets today”.
This market growth can be seen in a string of major deals taking place recently in the Emirates. e&'s deal with Careem follows its 2022 agreement with Abu Dhabi holding company ADQ to acquire a majority stake in video streaming service Starzplay Arabia. More recently, at the end of March, Noor Capital, an Abu Dhabi-based investment company and financial services provider, completed a 100 per cent acquisition of UK financial brokers, House of Borse.
Also last month, Mubadala Business Management Services, now rebranded as Solutions+, told The National it was considering acquisitions at home and abroad, as well as an initial public offering, as part of its growth strategy. And in the financial sphere, the chief executive of First Abu Dhabi Bank, Hana Al Rostamani, this week told The National that the business was open to acquisition opportunities in the Middle East and North Africa, as well as in other markets, as it continues to expand.
On one hand, these deals reveal a strong domestic recovery from the dark days of the pandemic. Last week it was reported that business activity in the UAE’s non-oil private sector had expanded at the strongest pace in five months, and employment in the Arab world's second-largest economy in March grew at the fastest rate since 2016. In addition, last Thursday the World Trade Organisation said the UAE's goods trade with the rest of the world hit $1.024 trillion last year.
But as well as highlighting a sound business environment in the UAE, this acquisition activity also shows a willingness to diversify and seek out new opportunities at home and abroad. e& has described its agreement with Careem as accelerating its transformation into a global technology group. This reflects Careem’s own development from a company that operated in a single industry to one that has diversified into many areas.
As a company, Careem is not just a prime example of a successful partnership between local talent and a major international company. It is an enterprise that shares the ambition inherent in the UAE business world and that continues to move forward with one foot firmly planted in the country where it all began.