valU enters Saudi Arabia: EFG Hermes’ buy-now-pay-later platform valU is set to enter Saudi Arabia by acquiring a stake in new Saudi consumer finance player Fas Finance, the companies said in a joint statement (pdf) yesterday. Under the partnership, valU will purchase a 35% stake in the Shariah-compliant lender from Fas Labs, a joint venture owned by leading Saudi retailer Fawaz Abdulaziz Alhokair Company (Alhokair) and mall developer Arabian Centres Company (ACC).

The details: valU has signed a sale and purchase agreement to buy 35% of Fas Finance’s SAR 55 mn paid-up capital from Fas Labs, Alhokair and ACC said in separate filings with the Saudi stock exchange (here and here). The transaction, valued at around SAR 19.3 mn (EGP 95.75 mn) by our math, will trim Alhokair and ACC’s indirect stakes in Fas Finance to 32.5% each.

The partnership marks valU’s first cross-border expansion. Its BNPL services will be available at Alhokair’s network of more than 1k retail outlets as well as online at Vogacloset, in which Alhokair owns a minority stake, and other brand webstores under the Alhokair umbrella.

Another first: valU will also start issuing cash loans for the first time alongside its BNPL service through the agreement, said valU CEO Walid Hassouna, without going into details.

The expansion to Saudi has been part of valU’s plans for some time now: Hassouna had previously flagged that valU would tap Saudi in 1H 2022. The fintech platform is also looking at the Moroccan and Tunisian markets in cooperation with EFG Hermes’ e-payments subsidiary PayTabs.

What’s next? Fas Labs in January received preliminary approval to set up Fas Finance from the Saudi central bank and is now waiting for the authorities to give final approval, and sign off on the acquisition.

ANOTHER EGYPTIAN FIRM IS EXPANDING IN THE GULF-

Raya Customer Experience will set up a new company in Dubai under the name Raya Gulf Customer Experience, the company announced yesterday in a bourse disclosure (pdf). The board of directors unanimously approved the decision to establish the new company, which will be funded entirely by Raya CX.

How will the new firm impact Raya CX’s existing Gulf business? It’s not yet clear what the relationship of the new firm will be to Gulf CX, in which Raya CX acquired an 85% stake for USD 12 mn last year. Gulf CX operates in Bahrain and Saudi Arabia, where it’s expanding operations with a new 400-seat facility set to be launched this quarter, according to its parent company’s latest earnings release. Raya CX also operates in the UAE. Gulf operations provided 12% of the company’s revenues in 1Q 2022.