Alibaba signed the loan agreement for more acquisitions in Asia.
Alibaba is interested in more acquisitions. The recent investment spree of the Chinese e-commerce company including the ongoing $3.5 billion worth acquisition of Youku Tudou and shares in Snapchat, Snapdeal, PayTM and Groupon will get new ammunition following the confirmation that the Hangzhou based company has signed a $3 billion loan.
The confirmation of deal is not unexpected as the Wall Street Journal reported negotiations with banking organizations in the last month but the cumulative figure announced on March 10, 2016 less than $4 billion.
From the SEC filing, today Alibaba has signed a 5-year $3 billion syndicated loan deal with a group of eight lead arrangers and the proceeds of loans will be used for general corporate purposes. It is not precisely clear what “general corporate purposes” may mean – Tech Crunch asked the company to provide it’s further details of plans – but M&A activity looks highly probable since Alibaba has recently boosted its efforts to invest money.
Media is a significant focus for the company as admitted by Joe Tsai who serves as the Vice Chairman of Alibaba after it bid for the biggest video portal of China, Youku Tudou. Joe said services such as Youku Tudou, which has claimed viewership on a monthly basis of more than 500 million people, and Weibo, another investment of the organization, can let it extend its advertising and user analytics reach to increase marketing and sales.
Other investments fitting inside the focus may be on the cards. Outside its local business, the market of India is where the organization is quite active. President of Alibaba Jack Ma often talks of the vast potential of India, which is the reason behind its investment of millions of dollars into the leading startups of the country.
PayTM, which provides e-commerce and mobile wallet facility, is one that has been supported by Alibaba. Apart from the two investments, it started to bridge its owned e-commerce facilities, including PayTM, enabling merchants in the Chinese region to reach the huge population of India and Indian buyers to purchase Chinese goods in a convenient manner. However, Alibaba is not relying on one company.
It invested money in Snapdeal and in 2016, according to reports of Indian media, it negated to purchase a share in harsh competitor Flipkart. It will be interesting to find out if the borrowed cash will be injected into Flipkart as that would let the organization support three largest companies that compete with Amazon in the Indian region.
In other news, Bloomberg reported Alibaba, along with its partners, has decided to provide Internet services to China’s largest gas and oil producer, China National Petroleum Corporation (CNPC).
The deal of the organization covering cooperation on online finance, mobile payments, and cloud computation – will enable it to tap into a network of CPNC’s 20,000 gasoline stations.
No comments:
Post a Comment