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Alibaba to buy Ele.me in $9.5bn deal

RBR Staff Writer Published 02 April 2018

Alibaba Group has agreed to acquire all of the outstanding shares that it does not already own in Chinese online delivery service Ele.me for $9.5bn.

The acquisition will allow Alibaba to strengthen the platform’s integration into its ecosystem and further extend the technology company’s New Retail strategy for local services. 

The online retail giant and its affiliate Ant Small and Micro Financial Services Group, presently own about 43% of stake in Ele.me. They had invested $1.25bn in the start-up in 2016.

Alibaba Group CEO Daniel Zhang said: “Looking forward, Ele.me can leverage Alibaba’s infrastructure in commerce and find new synergies with Alibaba’s diverse businesses to add further momentum to the New Retail Initiative.”

Under New Retail Initiative, Alibaba founder Jack Ma seeks to revamp traditional retail space by creating a frictionless blend of offline and online shopping underpinned by cutting-edge technology.

It will enable vendors to bolster their engagement with customers and get quicker and more precise feedback on consumer preferences to enhance their business.

The fast local delivery service of Ele.me will build on its core expertise in food delivery to offer consumers a range of products and service on-demand.

Ele.me will complement Alibaba’s affiliated local-services platform Koubei to provide an integrated experience to consumers both online and offline.

Ele.me will continue to operate under its brand and Alibaba will offer full technical support and expertise to further digitize its operations.

After the deal is completed, Ele.me founder Zhang Xuhao will assume the role of Ele.me chairman along with serving as special advisor to Alibaba’s CEO on New Retail strategy.

The company also noted that several sectors in China are already implementing its New Retail strategy, ranging from family-owned general stores to home furnishing conglomerates such as EasyHome and grocery giants such as Sun Art Retail Group.


Image: Alibaba to fully acquire Ele.me, boosting new retail efforts Photo: Courtesy of Alibaba Group Holding Limited/Alizila.