In a move that further intensifies its competition with Walmart and Amazon, Alibaba Group said it will invest approximately $3.6 billion in Sun Art Retail Group Limited, a leading hypermarket and supermarket operator in China, that will raise its aggregate direct and indirect stake to approximately 72%.
The transaction demonstrates Alibaba’s continued commitment to Sun Art, and its new retail strategy by further integrating online and offline resources in China’s retail sector, the company said.
Additionally, Peter Huang has been appointed chairman of Sun Art in addition to his current role as CEO.
Daniel Zhang, chairman and CEO of Alibaba Group, said, “Alibaba’s strategic investment in Sun Art in 2017 was an important step in our New Retail strategy. The alliance we formed with Auchan Retail and Ruentex was instrumental in building a robust infrastructure to create opportunities and value in China’s retail sector. Led by Peter Huang, Sun Art has achieved impressive results in its digitalization, and pursued promising synergies with businesses across the Alibaba digital economy. As the COVID-19 pandemic is accelerating the digitalization of consumer lifestyles and enterprise operations, this commitment to Sun Art serves to strengthen our New Retail vision and serve more consumers with a fully integrated experience.”
Sun Art operates 481 hypermarkets and 3 mid-size supermarkets in China, with a focus on strengthening its position through small and offline community stores.