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Alibaba to invest HK$22.4B in Sun Art to boost Offline Retail Business

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Published on : Nov 20, 2017

Physical stores aren’t passe, and, possibly can prove to be a potential tool in bridging the gap between online and offline retail businesses, transforming the overall shopping experience. A number of prominent retail players, especially in emerging markets, have in recent years started pouring in funds to provide the integrated experience. Leveraging the potential of digital technologies through adopting internet-based approaches is becoming key to bolstering a unified, seamless online and offline shopping experience world over. In China, that has opened up the path for a host of strategic alliances.

Alibaba Group Holding Limited, a Chinese e-commerce conglomerate, announced in November 20, 2017 that it has spent around US$2.88 billion (HK$22.4 billion) to acquire a stake of 36.16% in Sun Art Retail Group Limited, a leading multi-format offline food retailer. The stake—an aggregate direct and indirect one—has been made by investing in shares from Auchan Retail, a multi-national food retailer. After the deal is finalized Auchan Retail will hold the leading share of 36.18% in the Sun Art’s business and Alibaba Group will account for a significant share of 36.16%, while Auchan Retail will hold a small share of 4.67%.

Synergetic Alliance among Retail Giants Aims for Integrated Shopping Consumers in China

Auchan, an international food retailer, also one of the prominent brand through which Sun Art operates in China, will continue to consolidate the latter’s financial position. The synergetic alliances among the retail stalwarts will expectedly pave way for a seamless and largely delightful shopping experience to billions of China’s consumers.

Since 2014, Alibaba has been bolstering its positions in the offline retail business by investing in retail brands. This alliance marks the third of its alliance and will help redefine traditional retail in China through data-driven technologies, thereby benefitting China’s economy.

Alibaba, with its massive digital ecosystem, will help Sun Art, digitize its current retail solutions. Furthermore, the e-commerce behemoth, can aim for seamless integration of its multi-format offline and introduce innovative solutions, whiling enhancing personalized customer experiences for consumers in China.