Alibaba Group com­pany set to pay $535 mil­lion for Zhe­jiang Rongxin

China Daily (Canada) - - BUSINESS - By BLOOMBERG

Acom­pany con­trolled by AlibabaGroupHold­ing Lt­dChair­man Jack Ma will pay 3.3 bil­lion yuan ($535 mil­lion) to be­come the largest share­holder of fi­nan­cial soft­ware com­pa­nyHund­sun Tech­nolo­gies Inc.

Zhe­jiang Rongxin, 99.1 per­cent con­trolled by Ma, pur­chased all of Hund­sun Tech­nolo­gies Group, which owns a 20.6 per­cent stake of the listed Hund­sun Tech­nolo­gies Inc, ac­cord­ing to a fil­ing with the Shang­hai Stock Ex­change. Shares of Hangzhou-based Hund­sun have been sus­pended since March 17.

Alibaba is in­vest­ing in US and Chi­nese com­pa­nies be­fore an ini­tial pub­lic of­fer­ing in New York as early as this month. China’s largest e-com­merce com­pany said on Wed­nes­day it put money into a $250mil­lion fund­in­ground­for the ride-shar­ing ap­pli­ca­tion de­vel­oper Lyft Inc, and last month it led a $280 mil­lion in­vest­ment in Tan­goMe Inc, a mes­sag­ing ap­pli­ca­tion.

“It is clear that in­vest­ing and fi­nance are high on his agenda,” Mark Tan­ner, man­ag­ing di­rec­tor at China Skinny, a Shang­hai-based re­search and mar­ket­ing agency, said of Ma. “Both the IP and data he will ob­tain from the ac­qui­si­tion of Hund­sun Tech­nolo­gies will fur­ther en­hance his anal­y­sis for fi­nance and credit.”

Hund­sun, founded by eight en­gi­neers in 1995, works with clients in govern­ment and in the fi­nance, trans­porta­tio­nand ed­u­ca­tion in­dus­tries, ac­cord­ing to its web­site. Its businesses in­clude soft­ware to fa­cil­i­tate on­line pay­ments, which Alibaba han­dles through its af­fil­i­ate Ali­pay, and to help busi­ness-to­con­sumer web­sites, which would in­clude Alibaba’s Tmall.com.

Florence Shih, a spokeswom­an­for Alibaba, de­clined to­com­ment on Ma’s in­vest­ment. Ali­pay also has an In­ter­net fi­nanc­ing busi­ness called Yu’ebao that has drawn de­posits­from81 mil­lion cus­tomers as they chase re­turns higher than those of­fered by China’s banks.

Last month, Alibaba said it would in­vest about $692 mil­lion in In­time Re­tail Group Co Ltd, an owner of depart­ment stores and su­per­mar­kets, as China’s big­gest e-com­merce op­er­a­tor in­te­grates on­line and off­line shop­ping. The two com­pa­nies will form a ven­ture in China, us­ing shop­ping malls, depart­ment stores and su­per­mar­kets to de­velop an on­lineto-off­line busi­ness. Alibaba com­petes with Ten­cent Hold­ingsLtd­forthe­at­ten­tion ofChina’s 618 mil­lion In­ter­net users.

In Oc­to­ber, Alibaba led a $206 mil­lion in­vest­ment in ShopRun­ner Inc, a sub­scrip­tion ser­vice sim­i­lar to Ama­zon. Inc’s Prime plan that of­fers two-day ship­ping from ma­jor US re­tail­ers, as well as a $50 mil­lion in­vest­ment in Quixey Inc, a search en­gine for mo­bile apps.

The deals come as Alibaba pre­pares for an IPO that may value the com­pany at as much as $200 bil­lion as it cap­i­tal­izes on China’s po­si­tion as an eco­nomic su­per­power.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.