In a groundbreaking move, two of Africa’s largest B2B e-commerce platforms, Wasoko and MaxAB, have finalized their much-anticipated merger, marking a significant evolution in the continent’s $600 billion informal retail sector. The merger, which began discussions last December, has now been completed as an all-stock transaction, combining 16 subsidiaries across various countries into one powerful entity.
Daniel Yu, co-CEO of the newly merged company, revealed that this complex integration took eight months to finalize— a typical timeline for global mergers of this scale. Investors such as Tiger Global, Silver Lake, Avenir, and British International Investment had previously infused over $240 million into the companies before their merger.
Wasoko and MaxAB have established themselves as key distributors for small mom-and-pop shops across Africa, initially operating in eight markets. However, both companies have recently scaled back operations to focus on five core markets: Egypt, Kenya, Morocco, Rwanda, and Tanzania. This strategic retrenchment reflects broader trends within the B2B e-commerce sector across Africa, as many companies adapt to shifting financial landscapes and funding challenges.
The merger solidifies Wasoko and MaxAB’s position as the leading network of B2B informal retailers on the continent, with over 450,000 merchants. Although specific GMV (Gross Merchandise Value) figures were not disclosed, the merged entity is now focused on achieving profitability, a goal that was not prioritized during the companies’ earlier GMV-maximizing phases.
According to Yu, the combined company is now making a net profit per order and aims to scale its fintech offerings, which promise higher margins than the core e-commerce business. Both Wasoko and MaxAB had previously offered financial services, including e-payments, credit financing, and digital service top-ups, which will now be managed as standalone business units within the unified entity.
Egypt, the group’s largest market for fintech services, has already seen significant success, generating more revenue than its e-commerce transactions, which exceeded $180 million last year. The merged company has also provided over $20 million in merchant financing, boasting a repayment rate of over 99%. The companies project that their fintech revenue will more than double by the end of 2024.
As Wasoko and MaxAB work towards creating a unified brand name, their merger represents a pivotal moment in Africa’s B2B e-commerce landscape, combining resources and expertise to better serve the continent’s informal retail sector and unlock new revenue streams through financial services.
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