Takealot-Kalahari merger gets the official go-ahead

The merger between Takealot and Kalahari, two of South Africa’s largest online retailers, has been approved by the country’s Competition Commission and will come into effect as of 1 February this year.

The deal, first reported on in October 2014, will see the two ecommerce giants combining resources under the Takealot name as well as using its platform and technology. The new operation will be led by Takealot’s existing co-CEOs Kim Reid and Willem van Biljon.

“We are super excited about the approval of the transaction,” says Reid. “This will allow us to build a significant retail entity in South Africa, one that continues to be truly customer focused.”

Read more: Is the Kalahari, Takealot merger really in everyone’s best interests?

Currently the retail market for consumer goods in South Africa is approximately R800-billion, of which less than two percent is online. Worldwide online retail as a percentage of total retail is growing. China has an online retail market share of 10%, whilst in the US and the UK it is already approaching 15%.

“This is a necessary step in the evolution of online retail in South Africa and exciting news. The South African e-tail market is a highly dynamic one, and we foresee significant growth in the future” says Oliver Rippel, senior executive responsible for Kalahari.

While it seems likely that there will be casualties in the wake of the merger, the Competition Commission says it’s taken steps to mitigate any potential job losses.

Read more: Takealot’s Kim Reid talks new millions, expansion and the future of ecommerce

“It’s an approval subject to conditions to address employment concerns,” Hardin Ratshisusu, the acting deputy commissioner for the competition commission, told Fin24. He added that “potential job losses should not exceed 200”.

Takealot officially came into existence in 2011 following the acquisition of existing South African etailer Take2 by Tiger Global, a giant in the Hedge Fund game. Since then, it has become the dominant force in the South African ecommerce space, with a series of acquisitions including that of Mr Delivery and bespoke design curator Superbalist.

The merger represents the demise of the Kalahari brand, which has been around since 1998.