about a big deal; From entrusting digital goods to “insiders” to smoothing the path of the stock market

The purchase of 40% of Digikala’s shares in the hands of the first company in the amount of 8,400 billion tomans has led to various reactions. On the one hand, the valuation of DigiKala as one of the largest and most successful online businesses has been questioned, and on the other hand, some have said that the sale of a portion of DigiKala’s shares together with the former is almost the same value as DigiKala.

There are speculations about handing over 40% of private company shares to a quasi-governmental and so-called “insider” group, and they refer to Hossein Shariatmadari’s famous editorial in Kayhan newspaper about handing over startup companies to revolutionary forces, which was written a year ago on August 22.

This issue, along with Digikala’s desire to enter the stock market, is the main speculation about the deal that has been called the biggest deal in the country’s startup ecosystem. Mohammadreza KhanakiCEO of Ezekiel Capital, in a conversation with Zomit and in the analysis of different aspects of this deal, mentions these two issues. He believes that entering the stock market is important for Digikala; But with the previous shareholding structure, they did not allow Digikala to do this:

There is an argument that if a shareholder has a problem in terms of governance, it will be prevented from entering the stock market. Probably, this procedure has also happened with Digikala, and they want to include the shareholder, as they say, “qualified” in the composition of shareholders. Probably, they did not consider “Sarava” company as a qualified investor, and their attempt was to remove it from the mix so that the benefit obtained from Digikala’s entry into the stock market would go to a company that has a governance structure.

– Mohammadreza Khanaki, CEO of Ezekiel Capital

Also, he believes that with the purchase of 40% of Digikala’s shares, the company may have jumped to 51% in order to take control of the company.

Mohammad Hossein AmiriThe CEO of Vindad legal platform, also referring to Sarava’s exit from the shareholders, says: “For almost three to four years, companies like Digikala and Cafebazar, and companies like that, in particular, Sarava was one of their shareholders, have remained behind the doors of the stock exchange. The managers of these companies have repeatedly said that they have prepared all the requirements for entering the stock market; But they don’t know what prevented this from happening. On the other hand, when Tapsi entered the stock market, it showed that the start-up nature of these companies is not the obstacle to this happening; Rather, there is another obstacle, which is probably the structure of the shareholders of these companies.”

By giving these explanations, he predicts that the first partner, as a quasi-governmental group, will pave the way for Digikala to enter the stock market. The CEO of Ezekiel Capital also points to the goal of the Mohammadi brothers to enter the stock market and says:

When a company goes to the stock market and becomes a public company, it will have a public shield, and because it is tied to the public interest, it cannot be easily changed. Therefore, it was probably the decision of the Mohammadi brothers to sell a part of the company’s shares and make Digikala public and use its publicity for the company’s benefits.

– Mohammadreza Khanaki, CEO of Ezekiel Capital

Khanaki also believes that the most important reason for the purchase of these shares by the first partner is because of the major financial interests that exist in Digikala. He argues as follows:

He explains that this transaction is a type of pre-IPO transactions that are generally considered sweet contracts in the world; That is, if a company’s shares are bought before its entry into the stock market, the buyer will get a lot of benefits: “The first partner did exactly the same thing and probably bought the digital goods at a price 30 to 40% higher than the amount that the first partner spent on the stock exchange. will be Thus, a lot of profit comes to the first partner; The profit that the government prefers to be earned by a quasi-government company.

In the announcements that DigiKala and First Partner published about this transaction, the value of DigiKala is estimated at 30 thousand billion Tomans. Mohammad Hossein Amiri, CEO of Vindad, considers this figure strange and says:

The strange thing about this deal is the 380 million dollar valuation of Digikala; While two years ago, Palmgrennet, the shareholder of Digikala, announced the value of this company at around 950 million euros, and the current value of Digikala in this share purchase and sale is reported to be almost one third of that number.

– Mohammad Hossein Amiri, CEO of Vindad

Digikala has always been compared to Trendul, the Turkish e-commerce platform. This company is currently worth 15 billion dollars. Amiri points out that there is a big difference between the value of Digikala and Trendiol and explains that the reason for this difference is Trendiol’s access to the free market, free capital, etc.; But there are no such facilities for Digikala.

According to the CEO of Vindad, another factor is the big problems in our country: “Our economy is sick and we are facing Internet filtering and restrictions, and there are many risks for a collection like Digikala/all of these have an effect on its value.”

The CEO of Ezekiel Capital also believes that the expectation of Digikala becoming a unicorn is fundamentally wrong. He also points out all the obstacles on the way to becoming a unicorn; Even though the officials were talking about the goal of having 10 unicorns in the next three years. Becoming a unicorn means becoming a billion-dollar company, which cannot be a goal in itself. Khanaki explains about this:

The economy of our country used to be 500 to 600 billion dollars, but now it is 200 to 300 billion dollars. When a country’s economy shrinks, all companies in that country shrink too. If Iran’s GDP increases 5 times and reaches one trillion dollars, Digikala may become a 10 billion dollar company.

– Mohammadreza Khanaki, CEO of Ezekiel Capital

Some people say that the value of Digikala and the first companion is almost the same and equivalent to 500 million dollars. This equivalency is questionable; Because the online retail platform is expected to have more value than the mobile phone operator, like many countries in the world.

According to him, one of the reasons is that Digikala has been excluded from some markets due to some bans, such as LG and Samsung home appliances or iPhone phones. Or the departure of many foreign clothing brands due to the sanctions that have deprived Digikala from this market. Khanaki points to important statistics in this context:

There are statistics that show that the amount of Turkish clothes that people buy from the Trendul site and import into Iran is twice the value of Digikala today. This means that we have about 1.2 billion dollars just importing clothes from Türkiye and its sites. As a result, the market that DigiCala could reach and have on its platform has steadily eroded, causing the business to shrink. Regulatory restrictions, sales, payment, etc. are among the reasons for the shrinking of this business.

– Mohammadreza Khanaki, CEO of Ezekiel Capital

The equal value of DigiKala and First Companion has raised the question of how a company with equal value was able to buy a part of another company’s shares? Amiri says that the value of the first companion is approximately 31 hemats, and Digikala’s shares were sold for the same amount to the first companion, which is not very common in the world. However, in explaining this issue, he says: “It is said that the first companion was able to make this purchase due to his assets. Some speculations are that maybe the necessary resources for this purchase were provided from somewhere else.

Although some people consider the 30% discount announced for this transaction to be a big discount, Amiri says that discounts are common and customary in cash buying and selling of stocks, and various companies consider discounts in these cases.

Two experts who spoke with Zomit see a bright future for the parties of this deal. Mohammad Hossein Amiri says that the Mohammadi brothers are still shareholders and board members of Digikala, which shows that they want to keep their strategies centralized and in control. He concludes:This can be a good thing; Because their presence is effective for the growth of this collection. Being the first mobile operator in the country can also help them to enter the stock market and provide financing and marketing discussions.»

Referring to the huge number of subscribers of Mobile First and the possible price increase that will happen next year for this operator and the better financial resources it will find, Mohammadreza Khanaki predicts the increase in the speed of digital goods development and further points to an important event for Mobile First. will fall:The more important issue is that compared to its competitor Irancell, which owns Snap, the first company has not been very successful in building a digital ecosystem. In my opinion, if Digikala can accept its spirit with the first companion, building a digital ecosystem in the first companion can happen for the first time.»