Alibaba to invest $4.89 bil in grocer Sun Art, raising its direct and indirect stake to 72%

Bloomberg
Bloomberg10/19/2020 03:35 PM GMT+08  • 3 min read
Alibaba to invest $4.89 bil in grocer Sun Art, raising its direct and indirect stake to 72%
The deal signals the intention of Alibaba to try and dominate one of Chinese e-commerce’s largest untapped frontiers.
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

Alibaba Group Holding Ltd. will invest about $3.6 billion ($4.89 billion) to double its stake in Sun Art Retail Group Ltd., taking control of one of China’s largest hypermarts to try and fend off rivals like JD.com Inc. in e-commerce’s hottest growth arena.

Alibaba will raise its direct and indirect stake in the grocery chain to about 72% by acquiring equity from Auchan Retail International SA, then make a general offer to shareholders to buy out the rest of Sun Art. The latter’s Hong Kong-listed stock leapt as much as 30% Monday, its biggest intraday gain since 2011.

The deal signals the intention of Asia’s most valuable corporation to try and dominate one of Chinese e-commerce’s largest untapped frontiers. Alibaba Chief Executive Officer Daniel Zhang has made expansion into physical retail and the grocery business, in particular, a cornerstone of his growth strategy, an effort that paid off during the coronavirus pandemic. Sun Art already operates hundreds of hypermarkets across China under the Auchan and RT-Mart brands, a massive distribution and storage network that can supplement Alibaba’s own efforts in fresh produce.

For more insights on corporate trends...
Sign In or Create an account to access our premium content.
Subscription Entitlements:
Less than $9 per month
Unlimited access to latest and premium articles
3 Simultaneous logins across all devices
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)
×
Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.