Alibaba takes control of Sun Art hypermarkets
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Alibaba Group Holding Ltd. will invest about $3.6 billion to double its stake in Sun Art Retail Group Ltd., taking control of China’s largest chain of hypermarts to try and fend off rivals like JD.com Inc. in e-commerce’s hottest growth arena.
Alibaba will raise its direct and indirect stake in the grocery chain to about 72% by acquiring equity from Auchan Retail International SA, then make a general offer to shareholders to buy out the rest of Sun Art. The latter’s Hong Kong-listed stock leapt as much as 30% Monday, its biggest intraday gain since 2011. Alibaba gained as much as 1.8% to touch an intraday record.
Questions & Answers
Q.What is the primary reason for Alibaba’s increased investment in Sun Art?
What is the primary reason for Alibaba’s increased investment in Sun Art?
Alibaba is looking to strengthen its position in the e-commerce sector, particularly in groceries, to compete more effectively against rivals like JD.com Inc.
Q.How much is Alibaba investing to increase its stake in Sun Art?
How much is Alibaba investing to increase its stake in Sun Art?
Alibaba plans to invest approximately $3.6 billion to double its stake in Sun Art Retail Group Ltd.
Q.From which company is Alibaba acquiring the additional equity in Sun Art?
From which company is Alibaba acquiring the additional equity in Sun Art?
Alibaba is acquiring equity from Auchan Retail International SA to increase its direct and indirect stake in Sun Art.
Q.How did Sun Art's stock perform after the announcement?
How did Sun Art's stock perform after the announcement?
Sun Art's Hong Kong-listed stock jumped by as much as 30% on Monday, marking its largest intraday gain since 2011.
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