LONDON: The owners of Dubai-based listings sites Dubizzle and Bayut announced the merger of their MENA and South Asia operations as the regional property sector comes under pressure.
Dubai-based Emerging Markets Property Group (EMPG) and OLX Group made the disclosure in a statement carried by the UAE-based WAM news agency website.
The agreement includes a 550 million dirhams ($150 million) investment round, led by existing EMPG shareholders and OLX group. OLX has become EMPG’s largest single shareholder with 39 percent of shares, the statement said.
Both sites are known for their extensive listings in the real estate sector which has come under renewed pressure in recent months because of the coronavirus pandemic.
“This merger of EMPG and OLX will allow us to better serve our customers, given that both operate brands with a strong following and will allow us to leverage existing tech and data to paint a more accurate picture of the state of affairs in the real estate industry across the region,” said Haider Ali Khan, the head of EMPG — MENA . “At the same time, we will be making significant technology investments to provide more value to all users of property, automotive and other segments of the Dubizzle and OLX platforms.”
Merger and acquisition (M&A) activity is expected to accelerate this year as companies facing disruption from the coronavirus pandemic seek to cut costs and adapt to a rapidly changing marketplace.
Ali Maabereh, head of mergers and acquisition (M&A) at KMPG in Saudi Arabia predicted M&A activity will increase in GCC countries large corporates seek capital injections to satisfy working capital needs.
“The current pandemic is creating a lot of uncertainties and contradictions in what to expect after the dust settles. The expected key impacts on companies are shortages of liquidity and working capital requirements. Though companies might be running a healthy P&L, there will be significant pressure on working capital requirements,” he said.