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

Early on Tuesday news emerged that two of South Africa’s ecommerce giants, Takealot and Kalahari, would be joining forces. But just how good is the deal for ecommerce in South Africa.

Until now, the Tiger Global-backed Takealot and Naspers-owned Kalahari have probably been the fiercest rivals in the South African retail ecommerce space. Speak to people who buy online regularly and they’ll give you myriad reasons for choosing one over the other, ranging from delivery times to customer service and even the respective corniness of their advertising.

That competition has helped drive innovation in the space, to the point where it’s now worth more than R4-billion, with both companies snapping up smaller ecommerce stores.

A couple of months back for instance, Takealot bought out design curation outfit Superbalist, a purchase that could only have been aided by the US$100-million injection it received from Tiger Global in mid 2014. A previous investment from the New York-based hedge fund allowed it to buy a controlling stake in takeaway delivery service Mr Delivery, something which allowed it to boost its logistics capabilities.