For consolidating its control and targeting aggressive expansion in Southeast Asia, Alibaba is set to invest extra $2 billion in Singapore based e-commerce firm Lazada. With the additional investment long- time Alibaba executive Lucy Peng will take over as Lazada’s chief executive and replace founder Max Bittner who will become a senior advisor to Alibaba.
Prior to the investment, Alibaba held 83% stake in Lazada and this investment will increase it to an undisclosed amount, according to the spokeswoman who told Reuters.
The main competitors of Alibaba and its payment affiliate Ant Financial are Amazon Inc. and fellow Chinese retailer JD.com in the region. The aggressive expansion in Southeast Asia is important for Alibaba to tap new consumers amid slowing growth in China’s e- commerce market.
The latest investment brings Alibaba’s investment to $4 billion as it had already invested $2 billion in the Singapore based firm.
Also read http://fdianalytics.com/singapore-alibaba-investment/ for previous Alibaba investment.
Lazada is a privately owned Singapore based e-commerce company founded by Rocket Internet in 2011.
Lazada Group operated sites in Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. It had raised approximately US$647 million over several investment rounds from its investors such as Tesco, Temasek Holdings, Summit Partners, JPMorgan Chase, Kinnevik and Rocket Internet.
Its site was launched in March 2012, with a business model of selling inventory to customers from its own warehouses. In 2013 it added a marketplace model that allowed third-party retailers to sell their products through Lazada’s site; the marketplace accounted for 65% of its sales by the end of 2014.
About Alibaba Group Holding Limited
Alibaba Group Holding Limited is a Chinese e-commerce company that provides consumer-to-consumer, business-to-consumer and business-to-business sales services via web portals. It also provides electronic payment services, a shopping search engine and data-centric cloud computing services.
The group began in 1999 when Jack Ma founded the website Alibaba.com, a business-to-business portal to connect Chinese manufacturers with overseas buyers.
As of June 2016 it employs 46,288 employees and had revenue of CN¥101.143bn($14.65bn) and CN¥71.289bn($10.32bn) as net income.