Alibaba-Backed UCWeb Scouts for Mobile Acquisitions

January 17, 2014 Leave a comment

Alibaba-Backed UCWeb Scouts for Mobile Acquisitions

UCWeb Inc., the browser maker and app distributor backed by Alibaba Group Holding Ltd., intends to use acquisitions to add more programmers and platforms to fend off competitors Baidu Inc. (BIDU) and Tencent Holdings Ltd. (700) After investing in or buying 30 companies in the past four years, UCWeb has at least 1 billion yuan ($165 million) in cash and plans to adjust its target for spending this year as it expands globally, Chief Executive Officer Yu Yongfu said in an interview. The company had set a goal to invest 3 billion yuan for 2013 through 2015, and expended 2 billion yuan last year, including capital spending, Yu said.UCWeb, with more than 400 million mobile browser users and about 50 million customers at its app store, is challenging Baidu and Tencent, as booming smartphone use drives demand for mobile games, apps and the platforms to deliver them. The company this year will start offering its mobile gaming distribution systems overseas, targeting Russia, Indonesia, India and Vietnam, Yu said.

“From an investment aspect, we care about technology, because we are very technology driven,” said Yu, a former dealmaker with venture investor Legend Capital. “We want to understand and study new markets, so our investment isn’t only focused on China, but also overseas.”

Billionaire Jack Ma, Alibaba’s executive chairman, joined UCWeb’s board in August last year. Alibaba, China’s largest e-commerce company, bought a stake in UCWeb in 2009 and increased its investment in the first half of 2013, according to Jay Chen, a spokesman for UCWeb.

Alibaba Venture

The two companies will strengthen cooperation on mobile gaming as Alibaba announced this month that it would enter the mobile games distribution business.

UCWeb will also strengthen its ties with Alipay, Alibaba’s Paypal-like third party system, by introducing features that would make it easier for users to pay for mobile gaming services, Yu said Jan. 11.

The browser maker’s app store UC Application Store competes against Baidu’s 91 Wireless platform and its UC 9game mobile gaming platform rivals with one operated by Tencent.

UCWeb is still planning to sell shares to the public and has yet to set a timeframe, Yu said. The company said in 2012 that it was interested in an eventual initial public offering. Yu reiterated last week that he prefers to list in the U.S.

To contact Bloomberg News staff for this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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