Alibaba is investing $3.6 billion in Sun Art Retail power.
In addition, the Alibaba Group will spend around $3.6 billion to take ownership of Sun Art Retail, a big supermarket & supermarket provider in China, to further integrate its online and in – store resources.
“While the COVID-19 pandemic is escalating the digitalisation, this dedication to Sun Art serves to improve our vision as well as to serve more customers, with complete integrated experience,” Daniel Zhang, President and CEO of Alibaba Group, said. “This is the way to enhance our vision of new retail business.”
From November 2017, Alibaba initially invested into Sun Art to expand its presence in China’s booming retail market. All of China’s Sun Art physical shops are incorporated into Taoxianda & Tmall Supermarket networks, offering on demand for one and half hours. As from July 30, 481 hypermarkets & three med-sized Chinese supermarkets are operated by Sun Art.
In addition to Sun Art, Alibaba, the founder of Taobao, the largest online retailer in the world, has previously taken over other investments in this sector. It acquired 35% stake in 2014 (later it would acquire it completely and take it private) of the InTime store chain, a fifth of Sunning in 2015 and instead invested in Lianhua, the supermarket operator.
Unlike Alibaba’s increasing retail paper, foreign businesses in China have suffered to scale. The British supermarket store chain Tesco, German Metro, & French distributor Carrefour were among those who attempted and failed to smash Chinese markets.
This deal would increase the direct and indirect stake of Alibaba just to over 72%. The remaining shares of Sun Art for HK$17 billion were also purchased by Alibaba, which were announced in a filing to stock exchanges. The price is 21 percent above the closing price on Friday.
Alibaba will acquire 70.94 percent of the shares of A-RT Retail Shares from Auchan Retail International and its affiliate. A-RT owns about 51% of its Sun Art equity holdings. After the contract, Alibaba will include Sun Art in its financial statements and, in regard to his current position as CEO, appoint Peter Huang as President of Sun Art.
A-RT Retail is controlled by Auchan Holding, a unit of the Mulliez family investment, one of the wealthiest families in France.
Source-Campaignasia