Riyadh to Host Meituan’s 1st International Expansion

Meituan plans to launch its international food delivery platform in Riyadh, which is its first expansion outside the Greater China region. It also coincides with slowing growth in the local market within China, according to Bloomberg.

The Beijing-based company is working to launch the KeeTa application for the first time in the Middle East. Riyadh will be its first stop in this regard, according to people familiar with the matter.

The sources, requesting anonymity for privacy reasons, disclosed that Meituan had been researching Middle East expansion for months. According to one source, the move could occur in the coming months.

Meituan’s International Expansion

The global expansion of Meituan Company is an indicator of the tendency of Chinese companies to expand outside the country as they seek to enhance their growth in light of the intense competition within the local market.

The company’s expansion into Riyadh, which is considered one of the richest cities in the region, also comes after the large successful investments made by Hong Kong companies in the Saudi capital during the year 2023.

Meituan’s entry into Riyadh will mean it faces local competitors such as Jahez International Co., Talabat, a subsidiary of Delivery Hero, HungerStation, and Careem, which is backed by Uber Technologies.

Impact of Meituan Step on Saudi Arabia

Meituan’s move coincides with Saudi Arabia’s plan to invest trillions to become a tourism and commercial hub. Riyadh’s initiative may pave the way for Chinese companies to expand in the region, benefiting from the warm relations and welcoming environment, especially amid China’s domestic economic challenges.

But on the other hand, the launch of the “Kita” application may put pressure on companies that are already well-established in the Kingdom, such as “Delivery Hero,” which considers Saudi Arabia one of its largest markets in terms of revenues, according to Marcus Dibble, an analyst at JP Morgan.

On Friday, the Bernstein Foundation estimated the total value of the goods sold by Delivery Hero in Saudi Arabia at more than 3 billion euros ($3.2 billion).

“This demonstrates that established players in the industry are still able to compete with their newer counterparts who have deep financial resources but entered the market at a relatively late stage,” Dibble wrote.

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