Emaar, Dubai’s largest developer, has decided to sell Namshi, its online fashion platform, to Noon, an e-commerce company, for the sum of $335.2 million.
In this regard, the board of directors of Emaar has endorsed the sale, and before it goes through, the approval of board of directors of Noon is awaited.
During the last two years of the Covid Pandemic, online buying in the UAE has taken a big leap in growth, with Amazon alone recording net sales of about $500m in 2021.
According to the Dubai Chamber of Commerce and Industry reported, the UAE e-commerce retail market hit a record $3.9 billion in 2020, growing 53 per cent annually, with the sector accounting for 8 per cent of the overall retail market.
The Department of Economic Development has revealed that e-commerce licenses issued by the emirate jumped 63 per cent in the first half of 2021.
Consultancy AT Kearney estimated that GCC e-commerce revenues surged almost fivefold from $5bn in 2015 to $24bn last year, predicting that this will thrive further thanks to a permanent change in consumers’ behaviors.
Namshi was second with $249m, while Noon, the portal backed by Emaar founder Mohamed Alabbar and Saudi Arabia’s Public Investment Fund, was next with $169m.
“The above cash consideration is the equity value of Namshi, which is equivalent to $350m of the company’s enterprise value. This is adjusted for debt at the company level and normalized working capital required.”
Emaar will receive the equity value as cash consideration for the sale, the statement added.