HANGZHOU, Oct. 19 (Xinhua) -- Chinese e-commerce giant Alibaba Group on Monday announced that it will invest approximately 3.6 billion U.S. dollars to acquire control of Sun Art Retail Group Ltd., a leading hypermarket and supermarket operator in China.
Alibaba will seal the transaction by acquiring 70.94 percent equity in A-RT Retail Holdings Ltd., which owns 51 percent of Sun Art, from French multinational Auchan Retail International S.A. and its subsidiaries.
The acquisition will double Alibaba's aggregate direct and indirect stake to about 72 percent in the grocery chain, underpinning its "New Retail" strategy by further integrating online and offline resources in China's retail sector.
In November 2017, Alibaba, Auchan Retail International S.A. and Taiwanese conglomerate Ruentex Group announced a strategic alliance that brought together online and offline expertise to explore new retail opportunities in China's food sector. As part of the strategic alliance, Alibaba obtained an aggregate direct and indirect stake of approximately 36.17 percent in Sun Art.
"Alibaba's strategic investment in Sun Art in 2017 was an important step in our New Retail strategy," said Daniel Zhang, chairman and CEO of Alibaba Group, adding that Sun Art has achieved impressive results in its digitalization, and pursued promising synergies with businesses across the Alibaba digital economy.
Sun Art operates its hypermarket business under the brands Auchan and RT-Mart and has a fast-growing e-commerce business. It currently has more than 480 outlets across China.
According to Sun Art's semi-annual report, Alibaba's new retail solution boosted sales at Sun Art outlets by 5.7 percent as of June 30, 2020, while the retailer's net profit increased 16.8 percent year on year in the first half of 2020. Enditem