Alibaba offers to buy digital mapping company
Alibaba Group Holding Ltd, China’s top e-commerce site by revenue, offered a full takeover of AutoNavi Holdings Ltd, a US- listed digital- mapping company listed that holds rare mapping licenses from the Chinese government.
The tie-up will enable Alibaba to extend its virtual business to real-world uses.
Last May, Alibaba acquired 28 percent of AutoNavi’s shares for $294 million. The current all-cash offer proposes to purchase the remaining 72 percent at $21 per American depository share (ADS), which values the business at approximately $1.58 billion.
“Compared with its main competitors in China — Baidu and Tencent — Alibaba is relatively behind in terms of mobile services,” said Echo He, senior analyst at Maxim Group LLC. “Getting AutoNavi seems to be a good way to increase its market share in the mobile business.”