In this news, we discuss the Alibaba shops for hypermarket chain Sun Art in $3.6 billion deal.
(Reuters) – Alibaba Group Holdings BABA.N9988.HK on Monday announced it would invest $ 3.6 billion to strengthen its stake in hypermarket operator Sun Art Retail Group Ltd 6808.HK, gaining ground on the Chinese retail market.
The e-commerce giant hopes to leverage its digital presence to support Sun Art’s 481 hypermarkets and three midsize supermarkets in China. The move comes as Alibaba is gradually expanding its presence in China’s offline retail industry as the growth of traditional e-commerce slows.
Alibaba, which already owned 21% of Sun Art through a unit, will increase its stake to around 72% through the acquisition of a similar stake in A-RT Retail Holdings, which owns 51% of Sun Art.
“As the COVID-19 pandemic accelerates the digitization of consumer lifestyles and business operations, this commitment to Sun Art serves to strengthen our vision for the new retail and serve more consumers with a fully integrated, ”said Daniel Zhang, Chairman and CEO of Alibaba. in a report.
Alibaba added that Peter Huang would be appointed chairman of Sun Art in addition to his current role as chief executive.
Sun Art shares climbed more than 20% at the opening Monday after Alibaba’s announcement.
Alibaba has expanded outlets across China for Freshippo, a supermarket chain that also serves as an online delivery service. Alibaba operates 214 Freshippo outlets as of its latest earnings report.
He has also worked with mom-and-pop convenience store owners to provide technology and data analytics services.
Alibaba’s e-commerce rivals in China have made similar forays into physical retail.
Online retailer JD.Com Inc 9618.HK operates a physical grocery store called 7Fresh.
Pinduoduo Inc PDD.O, the growing e-commerce site known for its budget wholesale deals, bought a stake in appliance retailer Gome Retail Holdings Inc 0493.HK in August for $ 200 million.
Reporting by Nikhil Kurian Nainan in Bengaluru and Josh Horwitz in Shanghai; Edited by Stephen Coates
Original © Thomson Reuters
Originally posted 2020-10-18 19:56:10.