Alibaba said to have bought 20% stake in Wasu Media for US$1bn

Alibaba said to have bought 20% stake in Wasu Media for US$1bn

Staff Reporter

2014-03-07

Chinese e-commerce giant Alibaba Group has reportedly acquired a 20% stake in Wasu Media Holding Co worth about US$1 billion, the Guangzhou-based 21st Century Business Herald reports, citing market speculation after Wasu issued a statement on Tuesday to suspend trading.

The Shenzhen-listed company said on March 4 that it would suspend trading on the local stock market as it planned to adjust a private placement scheme. A spokesperson for Alibaba offered no comment in response to the market speculation.

A Wasu spokesperson said the suspension is because the firm intends to introduce a strategic investor, declining to elaborate further.

The investment, if true, will be another major investment for Alibaba after the company on Feb. 17 acquired a 72% stake in AutoNavi Software Co for US$1.045 billion.

The two companies have previously been partners in a joint venture, having jointly invested 100 million yuan (US$16.5 million) in a TV shopping venture. In 2011, Alibaba bought back Wasu’s stake in the joint venture for 28 million yuan (US$4.6 million).

On July 23, 2013, Alibaba unveiled its smart TV operation system, including box and smart TV, in which the box was jointly developed by Alibaba and Wasu, while the smart TV was developed by various partners including leading consumer electrical goods maker Haier Group.

Wasu is an important investment for Alibaba in the cable TV network sector, said DWRH.net editor-in-chief Wu Chunyong. Once the cable TV network’s ecosystem matures, Alibaba will copy its user-centered internet products and services and transfer them to the cable TV network, Wu said.

Alibaba founder Jack Ma is working to a four-year plan to enter the cable TV network sector in three stages: first is to set up a TV shopping network, the second is to establish an ecosystem by cooperating with partners to develop an alliance for smart TVs. Now the plan has entered the third stage, focusing on mergers and acquisitions to quickly complete the layout ahead of its competitors, the report said.

Alibaba is seeking to dominate the family internet market, the third network after the PC and mobile internet markets.

As the smart TV is still an undeveloped market for network shopping, it will be the key focus for Alibaba’s expansion.

 

About bambooinnovator
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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