Alibaba Group Holdings said on Monday (19th October 19, 2020) that it will invest $3.6 billion to boost its stake in hypermarket operator Sun Art Retail Group Ltd to gain further ground in China’s booming retail market.
Alibaba, which already owned 21% of Sun Art through a unit, will raise its stake to around 72% through the acquisition of a similar stake in Sun Art Retail Holdings, who owns 51% of Sun Art.
Alibaba Chairman and CEO Daniel Zhang said in a statement, “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”.
The e-commerce giant is hoping to further leverage its digital presence to support Sun Art’s 481 hypermarkets and three mid-size supermarkets in China as the coronavirus pandemic accelerates the shift by customers online.
Alibaba already owned 21 percent of Sun Art through a unit, will now raise its stake to around 72 percent through the acquisition of a similar stake in ART Retail Holdings, who owns 51 percent of Sun Art.
Alibaba further added that Peter Huang would be appointed chairman of Sun Art on top of his current role as Chief Executive Officer.