Alibaba is selling its 73.7% stake in Sun Art Retail to DCP Capital at a steep discount, marking the company's second major divestment of physical assets in recent weeks. This move signals Alibaba's focus on its core e-commerce operations amid intensifying competition.
Alibaba has agreed to sell its entire stake in China’s largest hypermarket operator at a steep discount, as it sharpens its focus on core ecommerce operations amid intensifying competition. The Chinese tech group will sell its 73.7 per cent stake in Sun Art Retail to private equity firm DCP Capital at HK$1.75 per share. The company disclosed this in a filing on Wednesday evening, after the shares had closed the day at $2.48. The sale is expected to raise gross proceeds of up to $1.
7bn, but will mean a loss of Rmb13.2bn ($1.8bn) for Alibaba shareholders when the deal is completed, it added. Sun Art’s Hong Kong-listed shares plunged as much as 35 per cent on Thursday before narrowing losses to 17 per cent. Alibaba’s shares slipped 0.7 per cent. The Sun Art deal came after Alibaba’s exit from Intime Retail Group in December, marking Alibaba’s second major divestment of bricks-and-mortar assets in less than a month. The department store chain was sold to a consortium including clothes retailer Youngor Group and Intime’s management team for $1bn, less than half what Alibaba had paid for it seven years earlier. The quick sales of Sun Art — the biggest hypermarket operator by number of stores and staff — and Intime at significant discounts underscore the urgency of Alibaba’s pivot back to its ecommerce roots in a bid to sustain growth and strengthen competitiveness. Once a dominant force in Chinese ecommerce, Alibaba is now racing to counter heightened competition from rivals such as Temu owner Pinduoduo, while retreating from unprofitable expansions into non-core businesses that have weighed on returns. Alibaba said in its filing that the sale of Sun Art represented “a good opportunity to monetise non-core assets and redeploy proceeds to focus on developing its core businesses and enhancing shareholder returns”. The group first invested in Sun Art in 2017, with it later taking majority control in 2020 in a HK$28bn (US$3.6bn) deal with France’s Mulliez famil
ALIBABA ECOMMERCE INVESTMENTS RETAIL COMPETITION
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