Saudi grocer BinDawood buys majority stake in online developer

Saudi Arabian grocery chain BinDawood Holding bought a majority stake in e-commerce app manager and developer International Applications Trading Co. (IATC) for an initial payment of SAR107.5m ($28.7m) that could increase subject to future profitability milestones.

BinDawood Holding, through its Future Technology Retail unit, signed a definitive agreement to acquire a 62 per cent stake in IATC, according to a statement.

The unit will make additional payments in 2023 and 2026, subject to achieving revenue and profitability parameters in the respective previous years. The deal is expected to close in the second half of the year.

The founder and IATC’s management team will remain in place, and BinDawood will invest up to an additional SAR160m over a two-year period to develop the platforms, the roll-out of stores and fulfillment centres and to help shorten delivery times, the company said.

The additional investment will increase BinDawood’s stake in IATC, with the overall position to be determined after IATC’s valuation following the finalising of its fiscal 2022 results.

Saudi Arabia is among the largest and fastest growing e-commerce markets in the region, with e-grocery shopping still in a nascent phase, BinDawood CEO Ahmad BinDawood said in statement, adding the firm is looking to control 30 per cent of the market by 2028.