SHANGHAI – Online giant Alibaba announced on Monday it will invest HK$22.4 billion ($2.88 billion) to acquire a stake in Sun Art, China’s largest operator of hypermarkets, as part of its strategy to increase presence in brick-and-mortar retail.
Alibaba is set to acquire 36 percent of Sun Art Retail Group Ltd. that operates around 446 hypermarkets in 29 Chinese provinces under the brand name of RT-Mart and Auchan, as part of an alliance with Auchan Retail S.A. and Ruentex Group.
“Alibaba is excited to join with our new partners to redefine traditional retail through digital transformation,” said Daniel Zhang, Chief Executive Officer of Alibaba Group in a statement.
Zhang added consumer experience in physical stores can and should be improved through data-based technology.
“By fully integrating online and physical channels together with our partners, we look forward to delivering an original and delightful shopping experience to Chinese consumers,” he added.
In a joint statement, the three companies explained that Alibaba would buy the stake from Ruentex while Auchan Retail would raise its stake in Sun Art.
After the transaction Auchan Retail, Alibaba Group and Ruentex will hold approximately 36.18 percent, 36.16 percent and 4.67 percent of Sun Art, respectively.
The statement also pointed out that the alliance, that will target opportunities in the food retail sector in the country, will allow Sun Art to benefit from Alibaba’s digital ecosystem as the company’s stores will be digitized and data intelligence will be introduced to provide a more personalized customer experience.