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Alibaba to Pay US$3.6 Billion to Acquire Controlling Stake in Sun Art Retail

   By Ben Otto 

Alibaba Group Holding Ltd. will invest about US$3.6 billion to acquire a controlling stake in hypermarket operator Sun Art Retail Group Ltd., part of the technology giant's efforts to bridge e-commerce operations with physical stores.

Alibaba will make the investment through subsidiary Taobao China Holding Ltd., raising its direct and indirect stake in China-based Sun Art to about 72%, the company said Monday.

Taobao China will also make a mandatory offer for all shares of Sun Art at a price of 8.10 Hong Kong dollars (US$1.05) per share, potentially paying up to an additional US$2.2 billion to acquire all remaining shares, Alibaba said.

The price, at a 2.1% premium to the stock's last-traded price, gives Sun Art a valuation of about HK$77.27 billion, Alibaba added.

"As the Covid-19 pandemic is accelerating the digitalization of consumer lifestyles and enterprise operations, this commitment to Sun Art serves to strengthen our New Retail vision and serve more consumers with a fully integrated experience," Daniel Zhang, Alibaba's chairman and chief executive, said in a statement.

At the end of June, Sun Art operated 481 hypermarkets and three midsize supermarkets in China, Alibaba said.


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(END) Dow Jones Newswires

October 18, 2020 21:06 ET (01:06 GMT)

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