A group of investors led by UAE businessman Mohamed Alabbar and Saudi Arabia's Public Investment Fund, launched the largest platform for e-commerce in the Arab world, named “Noon.com.”
In a press conference held in Dubai on Sunday announcing the platform, the Dubai-based billionaire stated that the platform will start its work in Saudi Arabia and the UAE simultaneously in January, and will start by offering 20 million products. The Saudi Wealth Fund will invest in a stake of 50%, while the other half will be owned by Alabbar and other regional investors.
Sources expected that a new e-shopping will enjoy high technical and logistical potential, and will open branches in several Arab countries. The company will also accompany the latest developments in e-commerce, including payment and delivery and consumer rights operations sector.
According to Reuters, Noon.com will launch operations in Saudi Arabia and the UAE in January, with 20 million products on the platform, Alabbar said.
The company plans to expand to Egypt by late 2017, and is also looking at Kuwait and Oman, though Alabbar did not give a timeframe.
E-commerce has struggled to gain a significant foothold in the Middle East, despite its young and tech-savvy population, hampered by inadequate logistics and electronic payment methods.
To compensate for issues around electronic payments, the venture will accept both online payments as well as cash upon delivery, Noon.com's chief executive Fodhil Benturquia said.
The Riyadh-headquartered company, which takes its name from the Arabic letter 'noon', is targeting profitability within five years and a possible stock market flotation within five to seven years, Alabbar said.
In recent months, Alabbar has made several investments which would support an e-commerce platform, including buying stakes in Italian online retailer Yoox Net-A-Porter,Dubai-listed logistics firm Aramex and Kuwait Food Co (Americana).
Noon.com will use Aramex’s and Americana's logistic capabilities to deliver goods, Alabbar said.
PIF also recently made technology-related investments, including the purchase of a $3.5 billion stake in ride-hailing app Uber in June and a pledge for 45 percent of funding for a $100 billion tech investment fund with Japan's SoftBank Group.
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