The new SILQ road? It's along Bangladesh and the Gulf 🌍
Profitability, IPO and M&As in the pipeline for ShopUp-Sary combo
SILQ Group has a lot lined up for the rest of 2025.
The B2B commerce firm is the Gulf’s latest powerhouse combo, bringing together Bangladesh’s ShopUp with Saudi Arabia’s Sary, in what is easily one of the largest cross-border M&A tech deals seen in the region this year.
Its new name is also a reflection of its new cross-cultural identity.
“It’s essentially a merger of two names. Silk being the Silk corridor, and Souq being the marketplace of the Middle East,” shared Vashistha Maheshwari, group CFO at SILQ Group in a video interview.
Last month, SILQ closed a $110 million Series C round led by PIF’s Sanabil Investments and Peter Thiel’s Valar Ventures to tackle the Gulf-South Asia trade corridor, projected to among the world’s largest at $682 billion.
But why merge?
A few reasons.
First, Saudi Arabia is home to one of the largest Bangladeshi diaspora communities globally. Some 2-3 million Bangladeshis live and work in the Kingdom, many of whom import local produce like puffed rice, mustard oil and spices.
A tie-up allows ShopUp to leverage its Bangladeshi supplier relationships to export to Saudi retailers — something Riyadh-based Sary has. The same can be said for Sary, which sees rising demand for agricultural produce like dates from South Asia.
The second is embedded finance. Over the last four years, ShopUp has been building supply chain financing via a $50 million loan from Lendable. The growth of that book became a strong margin enabler for ShopUp — something it intends to replicate and expand across Saudi Arabia.
A number of plans for its financing arm, SILQ Financial are already in motion.
The firm is in talks to acquire a non-banking financial institution (NBFI) in Bangladesh by the end of 2025, which will enable a wider variety of differentiated lending products across both markets, shared Maheshwari.
“The idea was that the financing facility will actually lead to supplier financing as well as reverse factoring products, and that itself would be a great margin enabler,” explained the former CFO of ShopUp.
“Once we do that (acquire the Bangladeshi NBFI), I think the cost of funding the embedded financing book would be much lower compared to what we've had so far, which is mostly USD led,” he explained.
Structuring the deal
That’s also why SILQ’s $110 million fundraise was primarily in debt.
$76 million comprised a loan facility from an institutional lender to grow SILQ’s financing business, while the remaining $34 million was fresh equity from new investors like Qatar Development Bank to drive its entry into the Middle East.
SILQ did receive a “bump up” in valuation but that was on account of the equity raised rather than the actual merger itself which was a pure share swap, explained Maheshwari, emphasising that valuations today are not driven by revenue but profits.
“I will be honest, it was one of the most complicated transactions I have done, even with my investment banking lineage. It was an all-stock acquisition plus capital raise. It was a cross-border deal with a Singapore holdco, Bangladeshi operations and Saudi operations…
We originated the idea, structured it, negotiated it, got it to conclusion without relying on external investment bankers…Now that the initial deal is done, we are moving towards the post-merger integration, and things are looking more exciting as we go deeper,” he shared.
Profitability targets & IPO plans
ShopUp and Sary will continue to keep both brands intact, with a few overlaps in the finance and engineering teams which SILQ will work on integrating over the coming year.
But it’s topmost focus for 2025 is profitability.