Alibaba in $80m media investment deal

2014-06-13 08:36 Shanghai Daily Web Editor: Qin Dexing

Alibaba Group and three other Chinese firms have made a combined investment of 500 million yuan ($80.4 million) in 21st Century Media Group.

Though the Hangzhou-based company did not reveal the size of its capital injection, analysts estimated the e-commerce giant's stake in the media company at 20 percent.

The deal is Alibaba's second major investment in the culture sector after it bought a 16.5 percent stake in online video streaming site Youku Tudou Inc earlier this year.

21st Century Media Group is the parent of a number of economic publications. Its controlling shareholder is Nanfang Media Group.

One of Alibaba's three partners in the deal is the central government-owned China National Building Materials Group. The state firm is the second in recent months to invest in the media sector, after State Grid injected 160 million yuan into China Business Network.

While Alibaba has been keen to strengthen its leading position in the e-commerce realm, through expansion into various tech sectors, it yesterday announced a new partnership with China Post that is designed to improve its logistics capabilities.

Alibaba operates China's most popular online shopping platform, Taobao, which holds more than 90 percent of the online market for consumer-to-consumer transactions, according to AFP.

But despite its dominance, the company has been beset with delivery problems.

It said in a statement that it will develop a "smart" logistics network with China Post through a strategic cooperation deal, integrating more than 100,000 post offices into its own network, AFP said.

The two firms will also collaborate on e-commerce, finance and information security, it said, without elaborating.

Taobao sellers have traditionally relied on privately run courier companies to deliver tens of millions of packages daily, rather than the vast yet often inefficient government postal service.

Alibaba said last month it will buy a 10.35 percent stake in Singapore Post — the city-state's main postal service — for $249 million and explore a joint venture in the global logistics business, AFP said.

It has also stepped up efforts to expand its business portfolio ahead of a planned stock market listing in the United States.

The flotation is expected to raise up to $15 billion, which would put the company on a par with Facebook's $16 billion listing in 2012.

Last year, Alibaba led a joint investment of 100 billion yuan in the creation of logistics network operator Cainiao Network Technology Co.