Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Blu Label bets big on energy as it pivots beyond prepaid distribution - Mark Levy

      Blu Label bets big on energy as it pivots beyond prepaid distribution

      25 February 2026
      Dennis Venter resigns as iOCO co-CEO

      Dennis Venter resigns as iOCO co-CEO

      25 February 2026
      Treasury moves to bring crypto under exchange-control rules

      Treasury moves to bring crypto under exchange-control rules

      25 February 2026
      Treasury grants Sentech R700-million special allocation

      Treasury grants Sentech R700-million special allocation

      25 February 2026
      South Africa puts data centres on par with energy, ports in big policy shift

      South Africa puts data centres on par with energy, ports in big policy shift

      25 February 2026
    • World

      Stripe mulling bid for PayPal: report

      25 February 2026
      Xbox chief Phil Spencer retires from Microsoft

      Xbox chief Phil Spencer retires from Microsoft

      22 February 2026
      Prominent Southern African journalist targeted with Predator spyware

      Prominent Southern African journalist targeted with Predator spyware

      18 February 2026
      More drama in Warner Bros tug of war

      More drama in Warner Bros tug of war

      17 February 2026
      Russia bans WhatsApp

      Russia bans WhatsApp

      12 February 2026
    • In-depth
      The last generation of coders

      The last generation of coders

      18 February 2026
      Sentech is in dire straits

      Sentech is in dire straits

      10 February 2026
      How liberalisation is rewiring South Africa's power sector

      How liberalisation is rewiring South Africa’s power sector

      21 January 2026
      The top-performing South African tech shares of 2025

      The top-performing South African tech shares of 2025

      12 January 2026
      Digital authoritarianism grows as African states normalise internet blackouts

      Digital authoritarianism grows as African states normalise internet blackouts

      19 December 2025
    • TCS
      Watts & Wheels S1E4: 'We drive an electric Uber'

      Watts & Wheels S1E4: ‘We drive an electric Uber’

      10 February 2026
      TCS+ | How Cloud On Demand is helping SA businesses succeed in the cloud - Xhenia Rhode, Dion Kalicharan

      TCS+ | Cloud On Demand and Consnet: inside a real-world AWS partner success story

      30 January 2026
      Watts & Wheels S1E4: 'We drive an electric Uber'

      Watts & Wheels S1E3: ‘BYD’s Corolla Cross challenger’

      30 January 2026
      Watts & Wheels S1E4: 'We drive an electric Uber'

      Watts & Wheels S1E2: ‘China attacks, BMW digs in, Toyota’s sublime supercar’

      23 January 2026

      TCS+ | Why cybersecurity is becoming a competitive advantage for SA businesses

      20 January 2026
    • Opinion
      The AI fraud crisis your bank is not ready for - Andries Maritz

      The AI fraud crisis your bank is not ready for

      18 February 2026
      A million reasons monopolies don't work - Duncan McLeod

      A million reasons monopolies don’t work

      10 February 2026
      The author, Business Leadership South Africa CEO Busi Mavuso

      Eskom unbundling U-turn threatens to undo hard-won electricity gains

      9 February 2026
      South Africa's skills advantage is being overlooked at home - Richard Firth

      South Africa’s skills advantage is being overlooked at home

      29 January 2026
      Why Elon Musk's Starlink is a 'hard no' for me - Songezo Zibi

      Why Elon Musk’s Starlink is a ‘hard no’ for me

      26 January 2026
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Opinion » Duncan McLeod » E-commerce foes click with merger deal

    E-commerce foes click with merger deal

    By Duncan McLeod12 October 2014
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Duncan-McLeod-180-profileTwo of South Africa’s biggest online retailers, Takealot.com and Kalahari.com, surprised just about everyone this week when they announced plans to merge their operations. The proposed deal is surprising because, until now, these two companies have been going hammer and tongs at each other for dominance of the still relatively young e-commerce market.

    The man at the centre of it, Kim Reid — a former Naspers senior executive and now Takealot CEO — has been talking about building an e-commerce giant in South Africa for several years now. As far back as 2011, he promised he was going to build Takealot into a R1bn-revenue business.

    The deal between the two e-retailers is being billed as a true merger. Media and e-commerce group Naspers, which owns Kalahari, will fold the company into Takealot and take a 41% equity position in the company from its current majority shareholder, Tiger Global Management, an international technology investment company headquartered in New York.

    Tiger and Naspers will then be equal shareholders. It’s not clear which entity will have effective control — if either — but it is perhaps telling that the Kalahari brand is being ditched in favour of Takealot, even though Kalahari traditionally has had the stronger brand of the two.

    The tipping point that led to this deal can be traced back to May, when Takealot dropped the bombshell that it had raised US$100m (more than R1bn) from Tiger Global Management. Tiger Global took control of Takealot in 2011.

    Tiger has invested in a number of Internet businesses in emerging markets, including China, Brazil, Russia, India and South Africa. Its other South African investments have included online auction site Bidorbuy and Private Property Listings. Tiger was an early investor in both LinkedIn and Facebook.

    When Tiger’s $100m injection into Takealot was announced, Reid said the e-retailer would use the money to play a much more aggressive role in South Africa’s e-commerce space.

    As many as three years ago, it was already evident that Reid, who took a 15% equity stake in Takealot with the Tiger investment, had big plans for the business. He said in an interview then that within five years he intended building Takealot’s revenues to over R1bn (from R75m then). The Kalahari deal, if regulators allow it, must surely take Reid much closer to his target.

    online-shopping-640

    “We have agreed on the capital expansion and the money has been raised and we are now funded to grow as we choose,” Reid said at the time of Tiger’s $100m investment.

    He said Takealot had enjoyed growth in excess of 100%/year and wanted to increase that growth rate. “If you look at the size of the market right now, there is a R550bn opportunity in which e-commerce is only just beginning to play a role,” he said.

    The decision to merge, Takealot and Kalahari said in a joint statement on Tuesday, was driven by the fact that, without scale, South African e-retailers “simply can’t compete successfully against the local brick-and-mortar retailers and foreign companies such as Amazon and Alibaba”.

    “After many years of losses on Kalahari and four years [of losses] on Takealot, we realise we have to work together if we are to survive and prosper,” a spokesman for Kalahari said in the statement.

    The comments are probably directed, at least in part, at South Africa’s competition authorities, which must satisfy themselves that if they allow the deal to proceed it won’t harm consumers or lead to a monopoly in online retail.

    It’s difficult to see how it would have a negative impact. Kalahari and Takealot aren’t the only generalist online shopping websites in South Africa, and online retailers must still compete with bricks-and-mortar stores and with international e-commerce companies like Amazon. And online retailers, according to Takealot, account for only 1,3% of retail sales in South Africa, against as much as 14% in some developed markets.

    No, this merger isn’t so much about creating a monopoly. It’s more about building an early and clear lead in a market that is set to boom in the coming years.

    • Duncan McLeod is editor of TechCentral. Find him on Twitter
    • This column was first published in the Sunday Times
    Follow TechCentral on Google News Add TechCentral as your preferred source on Google


    Duncan McLeod Kalahari Kalahari.com Kim Reid Naspers Takealot. Takealot.com Tiger Global Tiger Global Management
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleGone Girl: domestic disturbance
    Next Article How to stay private online, by Ed Snowden

    Related Posts

    Watts & Wheels S1E4: 'We drive an electric Uber'

    Watts & Wheels S1E4: ‘We drive an electric Uber’

    10 February 2026
    Bloisi's big cleanup - Fabricio Bloisi

    Bloisi’s big cleanup at Prosus

    9 February 2026
    Prosus inks three-year AWS deal to scale AI across its global portfolio

    Prosus inks three-year AWS deal to scale AI across its global portfolio

    4 February 2026
    Company News
    Netstar and Sunshine Tour team up on data-driven golf analytics

    Netstar and Sunshine Tour team up on data-driven golf analytics

    24 February 2026
    Vox customers set to benefit from direct, optimised Google connectivity

    Vox customers set to benefit from direct, optimised Google connectivity

    24 February 2026
    The human side of AI - Altron Digital Business

    The human side of AI

    23 February 2026
    Opinion
    The AI fraud crisis your bank is not ready for - Andries Maritz

    The AI fraud crisis your bank is not ready for

    18 February 2026
    A million reasons monopolies don't work - Duncan McLeod

    A million reasons monopolies don’t work

    10 February 2026
    The author, Business Leadership South Africa CEO Busi Mavuso

    Eskom unbundling U-turn threatens to undo hard-won electricity gains

    9 February 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Blu Label bets big on energy as it pivots beyond prepaid distribution - Mark Levy

    Blu Label bets big on energy as it pivots beyond prepaid distribution

    25 February 2026
    Dennis Venter resigns as iOCO co-CEO

    Dennis Venter resigns as iOCO co-CEO

    25 February 2026
    Treasury moves to bring crypto under exchange-control rules

    Treasury moves to bring crypto under exchange-control rules

    25 February 2026
    Treasury grants Sentech R700-million special allocation

    Treasury grants Sentech R700-million special allocation

    25 February 2026
    © 2009 - 2026 NewsCentral Media
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}