Chinese e-commerce giant Alibaba Group, which is said to be preparing for a public share sale that might be worth more than US$70 billion, is building up its mobile Internet business with a rash of acquisitions as the country's Internet users increasingly switch to mobile-phones and tablets rather than office-bound computers and home laptops.
The move to build up its mobile interests coincides with the transition to a new group chief executive, with Jack Ma, who helped found the company in 1999, stepping aside this month to be succeeded by Jonathan Lu after announcing his intention in January. Ma will continue with the company as executive chairman.
Last month, China e-commerce giant Alibaba Group acquired an 18% stake in Sina Weibo, one of the country's largest social network sites, for US$586 million. The deal also gave Alibaba the option to further increase its holding in Sina Weibo to 30%. Other targets include UCweb, China's leading mobile browser, Meituan, a leading group-buying company in the country, Momo, a popular mobile social networking app, and many more.
The purpose of behind the rash of purchases by Hangzhou-based Alibaba may be to beef up its business before the IPO, according to some speculation, while others view the goal as development of a mobile Internet empire that will bolster its present core e-commerce dealings. (Alibaba has two major businesses. Alibaba.com is its business-to-business marketplace and Taobao, which at present earns more than Alibaba.com, is its consumer-to-consumer marketplace.
The move to build up its mobile interests coincides with the transition to a new group chief executive, with Jack Ma, who helped found the company in 1999, stepping aside this month to be succeeded by Jonathan Lu after announcing his intention in January. Ma will continue with the company as executive chairman.
Last month, China e-commerce giant Alibaba Group acquired an 18% stake in Sina Weibo, one of the country's largest social network sites, for US$586 million. The deal also gave Alibaba the option to further increase its holding in Sina Weibo to 30%. Other targets include UCweb, China's leading mobile browser, Meituan, a leading group-buying company in the country, Momo, a popular mobile social networking app, and many more.
The purpose of behind the rash of purchases by Hangzhou-based Alibaba may be to beef up its business before the IPO, according to some speculation, while others view the goal as development of a mobile Internet empire that will bolster its present core e-commerce dealings. (Alibaba has two major businesses. Alibaba.com is its business-to-business marketplace and Taobao, which at present earns more than Alibaba.com, is its consumer-to-consumer marketplace.
The market believes Alibaba is aiming for a United States share listing this year. On May 14, investment bank Goldman Sachs wrote in a report on Yahoo, that it had increased Alibaba's valuation to US$70 billion, from US$35 billion. US Internet firm Yahoo owns 24% of Yahoo.
If Alibaba is listed, it might become the most valuable China Internet company in the public market. US-listed Baidu, China's leading search engine, which is worth about US$33 billion. Hong Kong listed Tencent, which has built its Internet empire with instant messaging service QQ is valued at about US$69 billion.
If Alibaba is listed, it might become the most valuable China Internet company in the public market. US-listed Baidu, China's leading search engine, which is worth about US$33 billion. Hong Kong listed Tencent, which has built its Internet empire with instant messaging service QQ is valued at about US$69 billion.
Alibaba's acquisitions may, however, be intended to build up its mobile Internet business, say some business insiders. As smart phones become increasingly popular, people's online habits are also changing, with less time spent on computers and more on their mobile phones.
Source: Asia Times
