Alibaba will acquire all outstanding shares in Ele.me, improving the delivery services company’s ability to provide shoppers with a seamless online and offline experience. Ele.me will build on its experience in food delivery to provide a wider range of products and services on-demand across China by combining its online home delivery services with the shopper acquisition and engagement capability of Koubei, a local services platform already affiliated with Alibaba.
Alibaba and its affiliates already owned an approximately 43% stake in Ele.me. The transaction values the delivery service at $9.5 billion.
The deal will bolster the e-Commerce side of Alibaba’s New Retail program, which aims to combine the retailer’s brick-and-mortar and digital services. The online retail giant took a 15% stake in Beijing Easyhome Furnishing in February 2018 to strengthen its physical presence, as well as a 38% stake in big data retail firm Shiji Retail Information Technology.
“Under the leadership of its founder and management team, Ele.me has achieved leading market share in China’s online food delivery and local services sector,” said Daniel Zhang, CEO at Alibaba Group in a statement. “Our shared belief that New Retail will create more value for customers and merchants has brought us together. Looking forward, Ele.me can leverage Alibaba’s infrastructure in commerce and find new synergies with Alibaba’s diverse businesses to add further momentum to the New Retail initiative.”
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Ele.me will operate as its own brand and continue working with its existing retail partners. Zhang Xuhao, founder of Ele.me, will become Chairman of Ele.me.
