Alibaba Builds Presence in Ride-Hailing Sector Amid Didi’s Regulatory Woes
E-commerce giant Alibaba Group Holding Ltd. has agreed to buy a 10% stake in a Shanghai-based state-owned online ride-hailing service, joining the flood of investment into the sector since market leader Didi Global Inc. had 25 apps removed from domestic app stores earlier this year amid a probe into violations of data privacy and security.
Dazhong Transportation Group Co. Ltd. (600611.SH) said Alibaba will invest 40 million yuan ($6.27 million) in its ride-hailing subsidiary Letzgo, it said in filing (link in Chinese) to the Shanghai Stock Exchange on Wednesday evening. The deal is subject to regulatory approval and will be scrapped if it fails to get the green light, the company said in a separate filing.
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