Alibaba Invests USD 3.3 Billion in its Logistics Subsidiary

Highlights

  • Recently, Alibaba Group announced an additional investment of 3.3 billion US dollars (23.3 billion yuan) in its logistics subsidiary, Cainiao Network.
  • Two years after buying a majority stake of Cainiao, Alibaba raised increased the investment to 63 percent from the previous 51 percent.
  • The move enables Alibaba to develop an efficient delivery logistics network, which is an increasingly important component to its enterprise-faced initiative Alibaba Business Operating System.

Cainiao works to improve service and user experience for merchants and consumers through advanced technology and digital solutions within China and across the world.

Alibaba will subscribe to the newly issued ordinary shares of Cainiao in its latest financing round to acquire its shares. The company will also purchase an equity interest from an existing Cainiao shareholder.

According to Alibaba owned South China Morning Post, “Cainiao will use the money raised to invest in technologies and logistics infrastructure services to strengthen its smart logistics network and enable innovations in business models, services and technological capabilities for the entire industry.” 

Last year, around 50.7 billion parcels were delivered through Alibaba’s online platforms. Thus, to push it forward, Alibaba has tightened its grip on the logistics sector within China. To improve its worldwide logistics, the company co-founded Cainiao in 2013 along with other five package delivery companies, including STO Express Co., SF Holding Co., and ZTO Express Inc.

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