Alibaba spending $1 bln to raise stake in Southeast Asia’s Lazada

In a bid to expand its footprint across Southeast Asia, Chinese e-commerce giant Alibaba will be investing $1 billion in online retailer Lazada Group, boosting its stake by almost a third to 83 percent, the two companies said in a joint statement. With only 3 percent of the region’s total retail sales conducted online, southeast Asia is expected to offer tremendous growth potential, Alibaba said.Alibaba took control of Lazada past year from Rocket in a $1 billion deal – its largest overseas move to date.Alibaba’s holding in Lazada will rise to 83 percent from 51 percent, taking its total investment to more than US$2 billion.Lazada is the number one online shopping & selling destination in Southeast Asia – present in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.”The e-commerce markets in the region are still relatively untapped, and we see a very positive upward trajectory ahead of us”, Alibaba Chief Executive Officer Daniel Zhang said in a statement. “We will continue to put our resources to work in Southeast Asia through Lazada to capture these growth opportunities”, he added.It did not name the shareholders, but Germany’s Rocket Internet and Sweden’s Kinnevik in separate statements confirmed they were disposing their remaining Lazada stakes.Founded by Rocket Internet in 2012, Lazada now serves six countries in Southeast Asia. Unlike Alibaba in China, Lazada also operates its own first and last mile delivery operation as part of its offering. The company is competing with well-funded rivals from MatahariMall to Sea Ltd., but Bittner said Lazada can count on Alibaba’s expertise.Alibaba said the new investment shows its confidence in Lazada to expand the company’s footprint into southeast Asia. Both companies have since worked together closely on areas like logistics and payments to facilitate a better experience for Lazada’s Southeast Asian consumers. Lazada helps more than 100,000 local and worldwide sellers as well as 2,500 brands serve the 560 million consumers in the region through its marketplace platform, supported by a wide range of tailored marketing, data, and service solutions.This year, Lazada introduced Alibaba’s Taobao online bazaar to Singapore via a dedicated website.