China’s e-commerce giant Alibaba Group Holding Ltd. is doubling down on its logistics affiliate Cainiao Smart Logistics Network, raising its equity stake to 63% from 51%.
Alibaba said Friday that it would invest an additional 23.3 billion yuan ($3.3 billion) to subscribe for newly issued Cainiao shares in its latest round of financing and would purchase additional equity interest from an existing shareholder.
Alibaba didn’t disclose which existing shareholder it’s buying shares from. It co-founded Cainiao in 2013 along with five package delivery companies, including SF Holding Co., STO Express Co. and ZTO Express Inc. Other investors include department store owner Intime Group, conglomerate Fosun Group, Singapore’s sovereign wealth funds Temasek Holdings and GIC, Malaysia’s sovereign wealth Khazanah Nasional, and Chinese private equity firm Primavera Capital Group.
Other existing shareholders also participated in the fundraising, Alibaba said.
Cainiao contributed 4.76 billion yuan of revenue in the quarter ended Sept. 30, or 4% of Alibaba’s total revenue. The unit’s revenue increased 48% from the same quarter in 2018, according to Alibaba’s earnings report.
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