Top 5 Startup Acquisitions That Broke the Records in the Middle East

Startup acquisition is one of the ultimate stages of the founder’s journey. It’s a process through which giant companies buy a normally full-grown startup to gain control over it by purchasing all or part of the company’s shares or assets. Acquisitions are exciting and challenging for both parties while benefiting them in several ways.
Startups are acquired for various purposes. For the acquirer, it’s a way of eliminating local competitors and expanding into new markets. However, for the acquiree, it’s a solution to gain good cash flow. Simply put, acquisitions are frequently a win-win deal.
Although startup acquisitions are much more prevalent in Europe and the US, we have witnessed a boost in the number of exits in the Middle East over the past years. A significant number of global giants are constantly observing the startup ecosystem in the region to take full advantage of the golden opportunities awaiting them. As international players, they’re looking to acquire a local footprint to complement their global presence.
If you’re interested to learn about some of the most significant startup acquisitions in the Middle East, follow this post to get an overview of the five most record-breaking ones.

1. Mumzworld by Tamer Group

Mumzworld is a UAE-based, registered company that offers the biggest e-commerce platform in the Middle East for all sorts of baby, child, and mother products. It was founded in 2011 in Dubai by two women, Mona Ataya and Leena Khalil, with the vision to provide Middle Eastern families with an exclusive hub to explore, compare, and purchase from a broad range of prominent regional and global brands.
Mumzworld currently serves more than 2 million customers throughout MENA and ships to over 20 countries, including Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, etc. The company provides over 250,000 baby/mother products from 5,500 suppliers. Note that Mumzworld was established by the same founders of Bayt.com (the MENA region’s largest job website with global Alexa rank #3700).
The “Amazon for Moms” was honored by CNN, was successfully acquired by the Saudi conglomerate Tamer Group in June 2021. It was described as the region’s first “woman-led e-commerce deal,” whose financial details were not officially disclosed. This significant transaction will definitely enable the company to expand geographically and diversify its product range by reinforcing its professional network and financial resources.
Tamer Group is a vast, Jeddah-based logistics company that supplies and distributes a wide range of healthcare, beauty care, and consumer products in response to the increasing needs of the region. It’s mainly involved in import, distribution, marketing, promotion, and production. Tamer also represents numerous leading startups in the region through different partnerships and joint ventures.
Being optimistic about the acquisition, Mona Ataya, the Mumzworld co-founder and CEO, stated in an interview: “We are a business that is home-grown. So, this acquisition by a strategic giant is the right DNA and the right strategic fit for us.”

2. Souq by Amazon

The acquisition of Souq.com was one of the most significant deals in the realm of startup entrepreneurship in the region undertaken by the globally acclaimed Amazon in 2017.
Souq (meaning “market” in Arabic) is one of the biggest e-commerce platforms in the MENA region, offering a broad diversity of goods in different categories of baby and toddler, computers and digital products, clothing, jewelry, perfumes, watches, and various accessories. It was founded in 2005 in UAE, Dubai by Ronaldo Mouchawar as a consumer-to-consumer auction website as part of Maktoob Group, the first leading web portal in the region.
In 2010, Sam Daoud joined the startup from the world-renowned eBay as CTO and catalyzed the evolution of the business model from auctions to a catalog-based business like Amazon.com. So, it gradually converted to a B2C-only company with a website where goods got categorized by over half a million SKUs. Needless to say, it has accomplished what no other startup in the Arab world could, with over 40 million visitors a month, reigning over 75% of the market.
The acquisition took place in March 2017 with an estimated transaction of $650 million, though it’s not clear and may even be higher. It’s worth noting that Amazon won the competition against Emaar with an offer of $800 million. With this acquisition, Souq became a subsidiary of Amazon in the Arab world with multiple websites, including amazon.ae, amazon.sa, and amazon.eg.
The founder, Ronaldo Mouchawar, believes that the acquisition has been a major step forward to developing the region’s capacity to invest in the digital ecosystem and create more enduring jobs. He states in an HBR post that “It will be much easier for Souq and Amazon to expand e-commerce in the region together than they could do as separate businesses.”
Whether you consider the acquirer, or the value of the record-breaking transaction made, the final episode of Souq.com finished in the best possible way. However, the record was broken again when Careem’s acquisition came on stage later on.

3. Careem by Uber

When the news spread throughout the world of entrepreneurship, many were dazed and asked if it was worth it for the giant Uber to acquire Careem for $3.1 billion? However, the deal was eventually signed and made Careem a brilliant example of a success story in the region. Do you know Careem’s story?
Careem’s co-founders, Mudassir Sheikha and Magnus Olsson, both used to work at McKinsey & Company as management consultants. In 2012, they came up with the idea of providing a ride-sharing service in the region as a chief rival of the recognized giant Uber. It started operation as a web-based service for online car booking by connecting passengers with local drivers. Later on, it evolved into a vehicle-for-hire service for everyday use.
Over the past years, Careem expanded to over 80 cities across the whole MENA region, plus Pakistan and Turkey. Needless to say, such massive expansion exerted intense pressure on Uber to seriously mull over acquiring Careem, the startup that was gradually pulling the rug.
Careem’s acquisition was a giant leap that broke all the records in the Arab world. The two companies signed an agreement of around $3.1 billion, including $ 1.4 billion in cash and $1.7 billion in loan bonds. The transaction was completed in the first season of 2020, allowing Uber to acquire Careem’s delivery, mobility, and payment businesses across the whole MENA region.
Dara Khosrowshahi, the CEO of Uber, stated: “I’m looking forward to seeing even more innovation from Careem, as they continue to operate independently under their current leadership.” He also hoped that the two platforms would take the golden chance to boost the unique potencies of each, to further benefit riders, drivers, and the locations they serve throughout the great Middle East.

4. Carriage by Delivery Hero

Another major success story in the list of acquisitions in the Middle East is Carriage, the leading Kuwaiti food and beverage delivery company serving the Gulf region. Carriage was founded in 2015 by CEO Abdullah Al-Mutawa, CFO Musab Jihad Al-Mutawa, COO Khalid Al Qabandi, all from Kuwait, and Jonathon Lau from the US.
The startup aimed to provide the best regional restaurants with the great opportunity to boost their operational capacity in the most efficient manner. It created a high-grade platform for restaurants to multiply their customers and subsequently their revenues while promoting their brand exposure and benefiting from free marketing. What’ made Carriage a significant success is the efficient, well-organized logistics that enable restaurants to merely focus on their main competencies.
Within 14 months of Carriage operations, Delivery Hero, the German multinational online food delivery service in Berlin, announced its acquisition of the Kuwaiti startup in May 2017. Both companies agreed not to disclose the terms and value of the deal. However, it is now estimated that Carriage was acquired for approximately $100 million (EUR 84.8 million) according to menabytes reports.
With only $1.3 million fundraising within such a short period, the acquisition is a definitely noteworthy feat in the history of entrepreneurship. Startups like Souq, Talabat, etc., which have recorded giant exits of the Middle East, took years to grow themselves before acquisition. But the story was quite different for the young Carriage to get such a massive exit.

5. Maktoob by Yahoo!

Across the Arab region, “Maktoob” is a well-known name among most internet users. It was founded in 2000 in Amman, Jordan, by Samih Toukan and Hussam Khoury as the world’s first free web-based platform offering users an Email service in both Arabic and English. At its peak, Maktoob served over 16 million users (0.47% of the total internet users) and ranked 156 among the world’s best internet websites.
This promising potential made the giant Yahoo! look to Maktoob as a marvelous opportunity to expand into the Arab region. Yahoo had already attracted 20 million users in English, and adding Maktoob’s 16 million users was a great temptation to record a turning point for the whole business in the region.
The acquisition in 2009 allowed Yahoo to offer content in Arabic for the first time and develop Arabic versions of its services. Following the deal, nearly 200 of Maktoob’s staff members became part of Yahoo, and both companies took advantage of each other’s services to boost online activity in the Arab world.
Like many others, the value of the deal was not disclosed, but it was estimated to be somewhere around $80 million. Although Yahoo made one of the oldest and most distinguished acquisitions in the region, it failed to capitalize properly and closed Maktoob soon after, thus putting an end to providing an Arabic email service.

Startup Acquisition Is on the Rise Across the MENA Region

We briefly went over in this post were just five of the most prominent acquisitions in the Middle East. However, there are many notable others to be added to the list. If you know a major one that has broken the records in the region’s ecosystem, don’t hesitate to share with us in the comments.