A pan-African e-commerce giant in the works: Egyptian B2B e-commerce platform MaxAB has inked a preliminary merger agreement with Kenya-based Wasoko, according to a joint statement (pdf). The merger aims to “drive the transformation of Africa’s informal retail sector … and establish the most successful digital retail platform on the continent.”

Short on details: We reached out to ask about who would own what post transaction, the valuation of the merged entity, and when the two companies expect to see the transaction go through. Company executives did not reply to request for comment. A PR contractor for Wosoko was unable to comment.

The merger will give the companies a combined customer base of over 450k merchants serving over 65 mn consumers in eight African countries. MaxAB already operates in Egypt and Morocco, while Wasoko is present in Kenya, Tanzania, Rwanda, Uganda, Zambia, and Congo.

They see a massive market: The two want to capture what they say is Africa’s USD 850 mn informal retail sector, offering fintech, logistics, and e-commerce services.

Top execs staying on: It’s not clear who will run the combined business, though the statement notes that MaxAB CEO Belal El Megharbel and Wosoko chief executive Daniel Yu are “committed to shaping the long-term future of the company together, and will both continue as full-time executive leaders” when the transaction wraps. The release refers to this as a “merger of equals,” but doesn’t make clear whether they intend to operate as a single brand or who will own what stake in the merged entity.

What we know of their capital: MaxAB last year closed a USD 40 mn pre-series B round to fund its expansion across the MENAP region. The capital injection followed a USD 15-mn extension to a USD 40 mn series A round in 2021 and a record USD 6.2 mn seed round in 2019. Wasoko in 2022 raised USD 125 mn in a series B round that valued the company at USD 625 mn.

Even more funding: “The combined business has received additional investment and has substantial runway to reach profitability,” the release says, without saying who invested.

This isn’t MaxAB’s first M&A: The company in August 2021 acquired Moroccan e-commerce and logistics platform WaystoCap for an undisclosed sum.

About the companies: Founded in 2018 by Belal El Megharbel (LinkedIn) and Mohamed Ben Halim (LinkedIn), MaxAB offers a range of e-commerce and fintech services targeting smaller retailers and suppliers. Wasoko was founded in 2013 by Daniel Yu (LinkedIn). The company enables smaller retailers to restock products for their businesses via mobile app.

The international press also had the story:Bloomberg | TechCrunch

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