Alibaba to acquire 36.16% stake in Sun Art Retail for $2.88bn

21 November 2017 (Last Updated November 21st, 2017 10:35)

Chinese e-commerce company Alibaba has reached a HK$22.4bn ($2.88bn) deal to acquire a 36.16% interest in hypermarket operator Sun Art Retail Group from Ruentex Group in order to strengthen its offline retail presence.

Alibaba to acquire 36.16% stake in Sun Art Retail for $2.88bn
The transaction is expected to allow Alibaba to achieve synergies between offline and online retail channels. Credit: Alibaba Group.

Chinese e-commerce company Alibaba has reached a HK$22.4bn ($2.88bn) deal to acquire a 36.16% interest in hypermarket operator Sun Art Retail Group from Ruentex Group in order to strengthen its offline retail presence.

As part of the deal, Alibaba will form a strategic alliance with Auchan Retail and Ruentex Group.

The transaction will also see Auchan increase its stake in Sun Art, which operates 490 outlets across China.

“We look forward to delivering an original and delightful shopping experience to Chinese consumers.”

Alibaba Group CEO Daniel Zhang said: “Alibaba is excited to join with our new partners to redefine traditional retail through digital transformation.

“Physical stores serve an indispensable role during the consumer journey, and should be enhanced through data-driven technology and personalized services in the digital economy.

“By fully integrating online and physical channels together with our partners, we look forward to delivering an original and delightful shopping experience to Chinese consumers.”

The move is part of the company’s continuing efforts to merge online and offline shopping into an omnichannel consumer experience.

The company’s digitised physical supermarket chain Hema allows shoppers to order online and make in-store purchases of groceries or freshly prepared foods through a mobile app.

In June, Alibaba agreed to acquire an 18% stake in Lianhua Supermarket to achieve business efficiencies.

The company also led a $300m investment round in B2C fresh produce online marketplace Yiguo.com in August.

Auchan Retail operates 3,715 points-of-sale across 17 countries.