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African E-commerce rivals – Wasoko and MaxAB – announce merger

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Two leading African e-commerce companies, Wasoko and MaxAB, have agreed to a landmark merger deal aiming to form the largest digital retail platform across the continent.

The Kenyan and Egyptian startups together serve over 450,000 small informal retailers and millions of consumers buying essential goods like food, household items and personal care products. Their merger as equals combines operations in 8 African countries.

MaxAB, founded in Egypt, dominates the North African market working with mom-and-pop stores. Wasoko began in Kenya and now operates in East and Southern Africa. Together they hope to accelerate pan-African e-commerce growth.

The deal terms remain private. But Wasoko recently raised $125 million while MaxAB added $40 million in funding rounds last year before merger talks began.

Both companies offer digital solutions helping connect consumer goods suppliers to neighborhood kiosks and stands in communities lacking formal retail infrastructure. Their apps and financing help local merchants restock and grow.

This allows us to properly build something pan-African in e-commerce for the first time. Crossing these regional divides is something that we are perfectly positioned for,” Wasoko CEO, Daniel Yu, said.

MaxAB’s CEO Belal El-Megharbel described combining their operations and network reach as able to “truly unlock the potential of Africa’s informal retail sector.”

The two fast-growing companies have seen revenues spike 30% this year as demand for delivered essentials booms. According to executives, both companies’ path to profitability should accelerate via shared capabilities across geographies.

The merger also faced some investor pressure. Wasoko underwent layoffs and market exits trying to cut losses, while MaxAB sought emergency funding to stay afloat according to sources. Now, their partnership aims to solidify operations, as the founders plan an extended expansion push after stabilizing the business.

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Other African e-commerce ventures like Jumia have struggled with profitability. But MaxAB and Wasoko officials see a ripe opportunity with informal merchants in largely untapped markets.

Joining forces multiplies their scale and resources to try bringing modern digital retail to more Africans relying on neighborhood shops for everyday necessities.

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