The agreement, reportedly inked about a week ago on 17 December, will see Alibaba become the majority stakeholder with 27.7 per cent of shares. It is expected to be competed after the Spring Festival in China in February 2016.
This latest round of funding comes after Ele.me, which roughly translates as “Hungry now?”, raised US$630 million in August this year. Its valuation is estimated at US$4.5 billion now.
With Tencent Holdings also an investor, Ele.me now has two members of the pyramid of power collectively known as “BAT”, which also includes Baidu and Alibaba, backing it.
The trio have been actively making power plays in the China’s internet business landscape this year.
In February, Didi Dache and Kuaidi Dache, backed by Tencent and Alibaba respectively, merged to form Didi Kuaidi, the largest taxi-hailing firm in China. In October, Baidu sold its interest in Qunar, one of China’s largest online travel companies, in exchange for a 25 per cent stake in Ctrip, another of China’s largest online travel companies.
Earlier this month, Alibaba also confirmed its acquisition of Hong Kong English-language newspaper, the South China Morning Post.