Alibaba buys NetEase’s luxury e-commerce unit for $2 billion
Alibaba Group has acquired Chinese gaming company NetEase's luxury import e-commerce platform Kaola for approximately $2 billion.
Alibaba Group has acquired Chinese gaming company NetEase’s luxury import e-commerce platform Kaola for approximately $2 billion. According to the statement released by both firms, the transaction enables the two Internet companies to further explore business collaborations.
Alibaba said Kaola will continue to operate independently under its current brand. Alvin Liu, Tmall Import and Export General Manager, will serve as Kaola’s new CEO.
Additionally, Alibaba and NetEase have entered into a definitive agreement for Alibaba, together with Yunfeng, to invest approximately $700 million in NetEase Cloud Music in its latest round of financing. The completion of this transaction is subject to certain closing conditions. NetEase will remain the controlling shareholder of NetEase Cloud Music following the closing of this transaction.
“We are pleased to have found a strategic fit for Kaola within Alibaba’s extensive ecosystem, where Kaola will continue to provide Chinese consumers with high-quality import products and services. At the same time, the completion of this strategic transaction will allow NetEase to focus on its growth strategy, investing in markets that allow us to best leverage our competitive advantages,” said William Ding, the Chief Executive Officer of NetEase
He added that the company remains fully committed to offering its users best-in-class and differentiated online content born from “relentless drive for craftsmanship and innovation”.
“As the controlling shareholder of NetEase Cloud Music, we will continue to fully support the growth of this business, helping it to realise its strategic goals in the music industry,” said Ding said.
Daniel Zhang, Chief Executive Officer of Alibaba Group, said, “Alibaba is confident about the future of China’s import e-commerce market, which we believe remains in its infancy with great growth potential. We welcome Kaola to the Alibaba family and value NetEase’s contributions in incubating an e-commerce platform with strong import capabilities. With Kaola, we will further elevate import service and experience for Chinese consumers through synergies across the Alibaba ecosystem.
“Alibaba also looks forward to becoming a partner in the future development of NetEase Cloud Music and exploring innovative collaboration in the digital entertainment space.”