Egyptian transport company SWVL has had a mix of good and bad fortunes in different markets. It has attempted to expand rapidly through acquisitions, but not all have turned out positive. In June last year, SWVL exited the Kenyan market, citing hard economic times.
The company has now announced it’s unwinding its acquisition of Turkey-based mobility startup Volt Lines, which it completed last year in April as part of its international expansion strategy. The $40 million deal was effectively canceled earlier this month.
These developments come at a time when SWVL is reportedly low on liquidity with its stock prices falling. The transport provider is said to have failed to meet its financial obligations to the startup it acquired.
By the time of the takeover. SWVL was an expansion spree that saw the startup acquire Spanish mobility platform Shotl, German’s public transport company Door2Door, and Argentina’s mass transport solution Viapool.
Volt Lines’ founder Ali Halabi said about the backtracking, “During our time with SWVL we had the chance to focus on the fundamentals which helped transform the Volt Lines business and thus more than double its value since the acquisition,”
“SWVL and Volt Lines benefited a lot from each other, however, the macro-economic climate made it very difficult for the deal to conclude. We’re very happy with taking back control of a stronger Volt Lines and we hope to cross paths again with the SWVL team, they were great to work with.”
SWVL has indicated it hopes to turn record a profit this year. Last year, Company CFO Youseff Salem said: “When we went public back in July 2021, we were estimating to turn profitable in 2024. In response to market conditions, we had to bring profitability forward by one year to 2023.