Alibaba to take majority stake in Cainiao Network 26 September 2017

Alibaba has announced that as a further step to implement its New Retail strategy, the Company has agreed to make an additional investment of RMB5.3 billion (US$807.0 million) to increase its ownership of Cainiao Smart Logistics Network Limited, the logistics affiliate of Alibaba, to a majority stake of 51.0%.

Alibaba also announced its intention to invest RMB100 billion (US$15.2 billion) over the next five years to further strengthen its global logistics network that aims to realise its mission of fulfilling orders in China within 24 hours and within 72 hours anywhere in the world. These investments are expected to enhance the overall logistics experience for consumers and merchants across the Alibaba ecosystem, as well as to enable greater efficiencies and lower costs in China's logistics sector.

Upon completion of the transaction, Alibaba's stake in Cainiao will increase from 47.0% to 51.0%, and Alibaba will gain one additional new seat on Cainiao's Board of Directors, increasing its Board representation to four out of seven seats.

The additional investment of RMB100.0 billion (US$15.2 billion) over the next five years will be used to increase R&D in logistics data technology, as well as for development of smart warehousing, smart delivery and global logistics infrastructure, all of which are core to building the global logistics network of the future.

This transaction is expected to be completed in October 2017, subject to satisfaction of customary closing conditions. Following the completion of the transaction, financial results of Cainiao will be consolidated under Alibaba Group and reported as part of the core commerce business segment.