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Investment  28, May 2014

Alibaba to buy 10.35% stake in SingPost with US$249 million investment

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How will this help the two companies to reach new heights internationally?

In a bid to tap into e-commerce opportunities in Southeast Asia and beyond, Chinese e-commerce firm Alibaba Group Holding Limited (Alibaba Group) has today announced its investment agreement with Singapore Post Limited (SingPost).

The former will invest S$312.5 million (US$249 million) to purchase 30 million existing ordinary shares held in treasury by SingPost and 190.096 million new ordinary shares, as well as a 10.35 per cent stake in the latter, according to an official document.

Having signed a memorandum of understanding, both companies will go forward to talk about a joint venture in terms of international e-commerce logistics. This will give Alibaba Group a quick route to SingPost’s logistics capabilities, infrastructure and delivery networks globally. SingPost will also be able to provide end-to-end solutions to Alibaba Group customers and merchants.

Also Read: Anchanto grabs funding from Innosight Ventures for Southeast Asian expansion

The Singaporean national postal service provider has earlier launched Omigo, an e-commerce site that will give the publicly-listed company a boost in distribution. According to the same document, 26 per cent of SingPost’s total revenue can be attributed to e-commerce and related businesses.

Daniel Zhang, Chief Operating Officer, Alibaba Group said: “… Through this collaboration, we hope to create concrete benefits for our overseas buyers and sellers by enhancing the user experience and providing greater access to a suite of international e-commerce logistics solutions and products.”

SingPost has invested S$100 million (US$80 million) into improving customer service and productivity. Wolfgang Baier, Group Chief Executive Officer, SingPost added that initiatives include replacing mail sorting machines, delivery fleets and offering 24/7 services like POPStation, which allows consumers to pick up their packages without going to the post office.

Elaine Huang

Elaine Huang

Elaine is a fervent believer that if there ever is a zombie apocalypse, we will all be snapping away at them with our phones and posting them onto Instagram. A Mass Communication graduate of Ngee Ann Polytechnic's School of Film and Media Studies, she enjoys writing about technology and entrepreneurs. When not hashtagging her way through all sorts of trouble, Elaine is probably contemplating how to write in the third person.

  • JitSiong Thaddeus Koh

    should ask aCommerce for their comments :)

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