Amazon extended its international footprint with a deal to acquire Middle Eastern ecommerce leader Souq.com.
Dow Jones Newswires, citing a banker familiar with the deal, estimated the price at about $700 million.
Ecommerce is still in the early stages in the Middle East, and data for the region is relatively thin.
An October 2016 survey of internet users in six markets across the region found that nearly 40% said they made digital purchases less frequently than once every three months.
But 45% of the respondents in an Effective Measure survey said they made digital purchases at least once a month—not an insignificant base from which to grow.
Amazon described Dubai-based Souq.com as the largest online retail and marketplace platform in the Arab world, with more than 8.4 million products for sale. It said Souq.com has 45 million visits per month.
Amazon's International Experience
Amazon has already learned a tough lesson in international expansion from its attempt to break into China. Although the company entered the market in 2004 with its purchase of online bookseller Joyo, it has little to show for its efforts. Amazon controlled less than 1% of B2C ecommerce sales in China in 2016, according to iResearch Consulting Group.
Amazon has now shifted its attention to India, pledging to invest $5 billion in its operations in the country. Those resources appear to have already paid dividends, with recent research showing that a high number of digital buyers in India use Amazon; homegrown company Flipkart is its main rival there.