By June 22, 2018

SA’s Online Stores Spree And Superbalist To Be Merged – An Early Call For E-Comm Sector?

By June 22, 2018

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Spree and Superbalist, owned by Media 24 and Takealot respectively and umbrellaed by Naspers are set to merge from 1st July 2018. It has been reported that as part of the deal,  Media 24 will hold the majority share at 51%  and Takealot will own remaining 49%.

This move comes after Naspers concluded that both e-comm stores share similar target market, but use different operational costs. The merger is also a bid to increase Naspers group’s scale and level of performance.

Although Media 24 is mainly a publishing media house, Spree has enjoyed a steady rise in terms of visitors on the online store to the numbers of orders since the first quarter of 2017. “Merging the two businesses into a single entity will create a larger, more focused platform on which to build a substantial online retail footwear, and apparel business”.

The merging venture is not new to Takealot. It was announced in 2014 that Takealot will merge with another e-commerce hub, Kalahari, which enjoyed a successful partnership until Kalahari closed shop.

But what set this merger apart is the division of responsibility, the size of both businesses in terms of performance in the market and the revenue. “Takealot will be responsible for the day-to-day operations and management of the business,” the statement released to the media reported.

“The merger entity will undergo a three month period of integration planning and implementation, during which each business will continue to operate independently before the final integration,” the statement continued.

The business is predicted to succeed after this merger as there’s little to no major competitors for the two online fashions stores. But this also becomes a moot point as with practically no competition, the consumer sits at the receiving end. With only Zando in the market identified as a notable competition, the merger looks like an early call.

E-commerce in South Africa is still at a nascent stage compared to developed countries but has been taking leaps and bounds in recent years. The accelerated rate of internet penetration in the country has contributed significantly to the increase in e-commerce, as has mobile usage, coupled with increased availability of more payment methods. In 2017, online sales were estimated to be amounting to R10 Bn and this figure is expected to shoot to R18 Bn by 2021.

Feature Image Courtesy: Cometlineconsulting

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