Chinese internet giant Alibaba Group Holding said Wednesday the company has reached a deal to buy 10.35 percent of Singapore Post Ltd. (SingPost) for S$312.5 million (US$248.8 million) as it seeks to expand its Asia-Pacific presence.
As part of the deal, Alibaba will buy 220 million SingPost shares, of which 190 million will be new shares and 30 million existing treasury shares, at S$1.42 each, according to Alibaba.
Both parties also signed a memorandum of understanding to explore a possible joint venture in international e-commerce logistics.
The tie-up will give Alibaba access to SingPost’s international logistics facilities. SingPost’s e-commerce and related businesses account for about 26 percent of its total revenue.
“We are excited to collaborate with SingPost and leverage SingPost’s strong delivery networks and end-to-end e-commerce logistics solutions to facilitate international e-commerce,” Alibaba chief operating officer Daniel Zhang said.
The Asia-Pacific e-commerce market has vast growth potential, with e-commerce sales expected to hit more than US$1 trillion by 2020, according to eMarketer.
This is Alibaba’s second major investment in logistics. In December, it announced a US$364 million investment in Chinese appliances maker Haier Electronics as part of a deal to set up a logistics joint venture.
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