IN THE LOOP Ralf Wenzel, co-founder and CEO, foodpanda group
Selling point
Investment round led by Mohamed Alabbar acquires 16% stake in Aramex
What’s cooking? Foodpanda merges with Hungerstation to strengthen Saudi Arabia presence
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eciding which online food delivery website to use just got easier for Saudi Arabia’s consumers. Online food delivery company foodpanda has merged its Saudi Arabian arm Hellofood with Hungerstation, a KSA-based food delivery startup. In a statement on the deal, foodpanda says that the business consolidation move pushes foodpanda to be a “clear market leader” in the region. Foodpanda also announced that with this merger, the company is now profitable in Middle East region, after having turned a profit in Central Eastern Europe last year. The company adds that both brands will continue to operate post-merger, providing access to variety of restaurants to Saudi consumers. Ebrahim Al-Jassim, founder, Hungerstation, will lead the existing teams, while Mehdi Oudghiri and Anass Boumediene, Managing Directors of foodpanda Middle East, will oversee operations. Commenting on the deal, Ralf Wenzel, cofounder and CEO, foodpanda, says that the company will now enjoy the benefits of having an experienced local team on the ground, “which understands the market, built strong relationships with restaurants, and continuously strive to bring the most convenient food delivery experience to our customers.” Having entered Middle East in 2013 under the Hellofood brand, foodpanda also operates two other food delivery companies in the region- 24h in the UAE, and Otlob.com in Egypt. Al-Jassim founded Hungerstation in 2012 in Dammam, KSA, as one of the first online food ordering portals in the region. The new deal comes at a time when consolidations are becoming common in the food tech sector, with investment action in new startups slowing down. According to a recent CB Insights report, global food tech deals dropped to 27 in Q1 of 2016 from a record high of 78 in the last quarter of 2015. UK-based food delivery company Deliveroo has emerged as an exception, raising US$275 million in Series E financing.
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Entrepreneur september 2016
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ohamed Alabbar, founder of Alabbar Enterprises, and Chairman, Emaar Properties, has led two investor groups that acquired a combined 16.45% stake in logistics major Aramex. According to Bloomberg, Alabbar acquired stakes in Aramex in two modes- 9.9% ownership through Boson Ventures Corporation (of which Alabbar is mentioned to be a lead investor) that purchased shares offloaded by Aramex founder Fadi Ghandour, and another 6.55% stake through Jaona Investment LLC, by way of a direct trade worth US$119 million on the stock market. The transaction seemed to have been welcomed at the stock market as Aramex’s shares rose, even as the GCC equity markets declined. An earlier Bloomberg report on the Jaona deal attributes Alabbar’s move to his keen interest to be a part of the Middle East region’s digital future, by building a region-wide e-commerce retail business. While Alabbar’s previous acquisition of 4% ownership in luxury fashion retailer YOOX Net-A-Porter in April points to the Group’s interest in ecommerce, Alabbar Enterprises had also acquired in June a stake in Kuwait Food Company Founder and Chairman of (known as Emaar Properties, Americana) Mohamed Alabbar for $2.36 billion, through Adeptio Investments. When Aramex announced its financial results for the second quarter of 2016, it had reported
an increase of 36% in its net profit and growth of 17% in revenues- both compared to the same period last year. E-commerce has been a key focus of Aramex too in recent years, with the company investing in a number of startups to strengthen its last-mile Fadi Ghandour, founder, Aramex
delivery including what3words in UK, Grab.in and Logisure in India, Shippify in South America, and others. Speaking to Bloomberg about why he exited Aramex, Ghandour mentioned that while he had been in an advisory role in Aramex for almost four years, he now wanted to focus his attention on the venture capital fund he was building, catering to technology investments in the region. As for Alabbar’s interest in his company, Ghandour noted that any company that desires to be in the e-commerce space needs a strong last-mile logistics infrastructure, and “it’s natural of anybody who thinks [of] logistics to think of Aramex.” Ghandour plans to use the capital from the sale to now ramp up his VC fund, with plans to set up “another fund going forward” and invest in tech startups as well.