Emaar plans to sell Namshi to Noon for $335.2 million – News
The property developer is currently sorting out regulatory issues as the Dubai Financial Market (DFM) has suspended trading in the company’s shares until clarification is received on the outcome of its board meeting.
Reuters file photo
Dubai’s biggest brand, Emaar, confirms its decision to sell its online fashion platform Namshi to e-commerce company Noon for $335.2 million. The property developer is currently sorting out regulatory issues as the Dubai Financial Market (DFM) has suspended trading in the company’s shares until clarification is received on the outcome of its board meeting.
On Saturday evening, the property developer released a statement signed by Ahmad Thani Rashed Al Matrooshi, a member of Emaar’s board of directors, stating: “The company would like to announce that its board of directors will meet via broadcast on August 22 to take a resolution respecting the date of the General Assembly. The meeting notice and agenda will be disclosed and published within the regulatory deadlines, ie 21 days before the General Meeting”.
On Friday, Emaar said in his filing to DFM that “the company wishes to announce that its board of directors has approved in principle the sale of Namshi to Noon (subject to the approval of Noon’s board of directors). The divestment expected is with a company-related party noting that the affected board member did not attend or vote at the meeting The award is to be a cash consideration of $335.2 million, noting that the award is within the range that has been set by an independent appraiser approved by the Securities & Commodities Authority.The cash consideration above is Namshi’s net worth, which equates to $350 million in enterprise value of the This is adjusted for company level debt and the normalized working capital required for the company.Emaar will receive the equity value as cash consideration for the sale. details will be disclosed once noon council approvals have been officially received.”
Vijay Valecha, Chief Investment Officer at Century Financial, said: “Emaar has been in the news for the past few weeks and for all the right reasons. The sale of Emaar’s stake in Namshi to Noon is a hugely positive sign for the company. We have seen many companies in the past diversifying into multiple horizons without consolidation. Emaar is taking all necessary steps to keep its core business at record sales and share prices are on a superb upward trend. The stock closed at Dh5.91 on Thursday and rose more than 10% for the week following the sale of Namshi, as it will largely improve the company’s liquidity and debt ratios. Emaar’s positive ratings could eventually lift the stock above the Dh7 mark, a price not seen since 2017.”
A recent report by global e-commerce accelerator Pattern indicated that online shoppers in the United Arab Emirates will spend more time online to shop. The report was conducted to understand the behavior of online shoppers, including how they use marketplaces such as Amazon and Noon. The findings support forecasts for the UAE e-commerce market size to grow to $17 billion by 2025, according to Kearney. Overall, 74% of online shoppers surveyed said they would spend more on online shopping in 2022. About 19% expected to spend as much as they did in 2021, and only 6% expected to spend less . The results are included in Pattern’s UAE Shopper Report 2022. The research also shows that Amazon and Noon marketplaces have quickly become favorites for online shoppers in the UAE. More respondents expected to shop online this year from Amazon or Noon than from other online retailers for each major product category, including fashion, consumer electronics, home and kitchen, and beauty.
Anurag Chaturvedi, Chairman of ICAI Dubai and CEO of Andersen UAE, said, “The Namshi and Noon transaction brings efficiencies at both ends and fosters a significant positive impact on Noon to become the largest e-commerce marketplace. and market in the region adding Namshi’s credibility for fashion which is increased over the years in multiples of Ebita. As Emaar is the leading real estate conglomerate, it will raise cash to strengthen its diversification in its real estate portfolio. The move brings positive cash to Emaar to invest in the UAE’s growth-oriented GDP with a focus on real estate. Given the global economic turmoil, bringing UAE real estate into the spotlight and diversifying into this area will generate positive results for Emaar and its shareholders. E-commerce is a specialized business and requires significant investment to drive growth and expand the market base. Thanks to this transaction, Noon can take advantage of Namashi’s offers to increase its market share. – [email protected]