Alibaba in talks for WHA land
CHINESE e-commerce giant Alibaba Group is vying to build up its footprint in Thailand by negotiating with WHA Corporation Pcl for the latter’s industrial estate land in Chachoengsao.
The move would be Alibaba’s second major investment in Thailand and would leverage its supply chain in Asean. Last year Alibaba invested 11 billion baht ($345.8 million) in the government’s flagship Eastern Economic Corridor (EEC) scheme for the first phase of the Smart Digital Hub.
Alibaba wants to use the investment to drive its core e-commerce business by supporting the group’s online payment platform Alipay, marketing technology platform Alimama, cloud computing firm Aliyun, and logistics firm China Smart Logistics Network.
“WHA Corporation is in negotiations with Alibaba Group and we expect to settle a deal with them soon,” said WHA chairman and CEO Jareeporn Jarukornsakul.
“The ta lks are about new investment i n WHA’s i ndust r ia l est ate la nd a nd we ex pect our log ist ics business will see more benefits from t he deal,” she said.
Alibaba expects to construct a Smart Digital Hub in the EEC this year that will include a digital platform, distribution and logistics centre, IT system and automated robotics system to serve trade from Thailand to neighbouring countries.
WHA declined to give more details about the investment.
Jareeporn said WHA has prepared the land for Alibaba’s first investment in a Smart Digital Hub located in Chachoengsao. WHA will deliver the first phase of built-to-suit land for Alibaba’s logistics business, with 130,000sqm of land, in September.
“Alibaba has no fear or concern about Thailand’s political situation because it considers Thailand much more stable than neighbouring countries, so Alibaba plans to expand investment in the country,” she said.
For the first quarter, WHA reported its industrial estate business achieved domestic land sales of 16.96ha, with a remaining backlog of 106.72ha as of March thanks to seven new contracts for land sales in industries such as automotive and electronics, mainly from companies from China, Taiwan and Thailand.
WHA’s industrial estates in the EEC area have been designated as targeted industry promotion zones by the government, totalling 5509.44ha.
In the first quarter this year, WHA reported sales revenues rising 10.3 per cent year-on-year to 3.8 billion baht thanks to demand growth in industrial estates to serve EEC projects and other recurring income.
Prof it decrea sed 47.9 per cent yea r-on-yea r to 407 mil l ion ba ht because of a planned shutdown of WHA’s Gheco-One power plant for major maintena nce over 39 days during t he f i rst qua r ter t his yea r, which signif ica nt ly af fected prof its from its power business, in addition to currency volatilit y.
WHA set an ambitious growth target of 70 per cent year-on-year for this year for revenue and profit-sharing, with capital expenditure from 2018-22 allotted at 45 billion baht.
For industrial development, which accounts for 29 per cent of WHA’s revenue, the group aims to sell industrial land spanning 256ha, developing 424ha this year.
For 2018, WHA expects to post revenue of 11 billion baht, well below 12.4 billion logged in 2017.