BinDawood, Saudi Arabian supermarket retailer, has purchased an 80.5 per cent stake in Ykone, French influencer agency, for an undisclosed amount.
The acquisition aligns with BinDawood’s efforts to strengthen its e-commerce business amid the rise of online grocery shopping in the kingdom.
“The acquisition of Ykone represents another important milestone in Future Technology Retail’s ambition to invest in all segments of the retail e-commerce value chain,” said Ahmad A. R. BinDawood, chief executive of BinDawood Holding.
“This investment in cutting-edge marketing technology and a trusted, full-service agency, with a global and local footprint, will strengthen the growth of our business and enhance our focus and nimbleness while providing a platform to Ykone for accelerated growth in the Middle East and beyond.”
In turn, Ykone aims to leverage BinDawood Holdings’ financial and commercial strengths to improve its technological platform, diversify into more categories and access more markets in the region, beyond its existing presence in Riyadh, Abu Dhabi and Dubai.
“This partnership with BinDawood Holding marks a milestone in the incredible growth and success we have achieved to date and will propel our growth across the Gulf States in the retail, travel, tourism and entertainment sectors,” said Olivier Billon, founder of Ykone.
The acquisition will be funded through the newly formed French division of Future Technology Retail, a subsidiary of BinDawood Holding.
Future Technology Retail are still able to purchase an additional share of 4.9 per cent, with the remaining shares to be held by Mr Billon.
In keeping with efforts to capitalise on increased demand for e-commerce, , BinDawood Holding signed an agreement to purchase a 62 per cent market share in e-commerce partner International Applications Trading Centre earlier this year.
International Applications Trading Centre has developed and operates numerous e-commerce platforms for BinDawood Holding’s retailers, including luxury clothing retailer ETRE and hypermarket and supermarket chains BinDawood Stores and Danube.
The deal is expected to close in the second half of this year.
The retailer has paid SAR107.5 million and will invest up to SAR160 million over the next two years to improve overall performance of its e-commerce platforms and fulfilment centres to deliver products faster.
During 2019 and 2020, Saudi Arabia’s e-commerce market grew 60 per cent amid the pandemic and digital transformation age, according to a report by global management consultancy firm Boston Consulting Group and multinational technology conglomerate Meta Platforms.
The report estimates that e-commerce will value $13.5 billion by 2025.
The kingdom’s grocery retail market is expected to grow by 2.8 per cent each year to reach SAR177.5 billion by 2027, with its e-commerce penetration rising from 0.8 per cent to 3.5 per cent, say market research firm Euromonitor and accounting organisation Klynveld Peat Marwick Goerdeler.
By 2028, BinDawood aims to manage 30 per cent of the e-commerce grocery market.
