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Alibaba Bets On Indian Logistics Companies

Alibaba delivery, Alibaba Asia

The Chinese E-Commerce company bets on India based logistics delivery service providers for helping it deliver items to its customers in India

Alibaba Group Holding Limited, which has previously invested in the Indian online retailers Snapdeal as well as Paytm, is now betting on Indian logistics companies. As per reports by Economic Times, it’s looking to invest in or purchase Xpressbess Logistics as well as Delhivery in the upcoming four to six months.

The online retailer has also planned to sell off the marketplace business of Paytm and inject with more capital investment. The Hangzhou based organization and its financial affiliate Ant financial jointly own around a 40% share in the organization. In recent times, Ecom Express and GoJavas have also shown interest in the organization’s entrance in the country to clinch a tie-up.

Senior executives from XpressBees and Delhivery have interacted with the group which the web retailer has established for entering India. The team is led by the Alibaba Company’s Bharati Balakrishnan and Global Managing Director K Guru Gowrappan.  In 2011, Gurgaon-based organization Delhivery was founded by Suraj Saharan, Kapil Bharati, Bhavesh Manglani, Sahil Barua and Mohit Tando.

The organization was valued at $4.43 million in its $85 million Series D financing round. It is funded by a number of investors like Times Internet, Nexus Venture Partners and Tiger Global management. On the other hand, a number of current investors invested $12.38 million in Pune-based E-commerce logistics service provider. These include Valiant Capital, Vertex Ventures, NEA, IDG Ventures India and SAIF Partners.

FirstCry had begun to run its logistics business 3 years ago when it took the decision to begin express deliveries of its items, and then entered into the market for third party logistics  at the start of the last year. The business has been established by its founders of FirstCry Amitava Saha and Supam Maheshwari. The organization was sold off as BusyBees in Sept last year.

Busybees Logistics Solutions-owned Xpressbees  has claimed that it has scaled more than 1 million deliveries on a daily basis on the back of only $5 million in financing. It makes deliveries to 200 cities, with ‘next day’ and ‘same-day’ in almost 100 cities, and covers more than 3000 pin codes.

Xpressbess will use the money to improve its tech and extend its operations. The organization looks to compete with other online retailing-focused logistics organizations such as Ecom Express, which is backed by Warburg Pincus and Delhivery. Many of the topmost E-commerce organizations including Amazon, Myntra and Flipkart are supported by logistics service providers.

Indian online shopping platform operator FlipKart delivers through Ekart, while Snapdeal bought a share in GoJavas to help it deliver items. Besides, online furniture retailer, FabFurnish introduced its logistics facility Fabone. Previously in June 2016, Xpressbees received around $8 million from Singaporean state-owned investment organization Temasek and SAIF Partners.

 
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Posted by on June 16, 2016 in Technology

 

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Alibaba Plans To Rule the Asian E-commerce Industry

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The online retailer has bought a controlling stake in Lazada Group to dominate the Asian E-commerce industry

The E-commerce market of China is most established on the earth- it’s bigger than Western markets Europe and US. With not a lot of space for rising market shares, the game in the country has for a long period of time been over. And who is aware of that better than the online trading company of China, Alibaba?

That is why the organization owned by tycoon Jack Ma announced it is entering the next lucrative ecommerce market: Southeast Asia. On 12th April 2016, the Chinese online retailer announced that it has taken the decision to purchase a controlling stake worth $1billion in Lazada of Rocket Internet, the fastest expanding online departmental chain that is viewed as the rival of the Hangazhou based organization in the Southeast Asian region.

Lazada sells an extensive range of goods- from consumer electronics to clothing- in Vietnam, Thailand, Phillipines and Indonesia. Alibaba has stated shares from current shareholders and half a billion dollar worth newly issued equity sum up to make the $1 billion investment.

Lazada Group CEO Max Bittner stated “Southeast Asia is an attractive mobile-driven consumer market that is highly fragmented and diverse with significant barriers to entry and a nascent modern retail sector that has large headroom for growth,”

The agreement includes a provision for the web retailer to purchase most of the residual stake in Lazada. The press release issued by Rocket Internet tells us that the German internet company yet has a stake of 8.8% in the Singapore based organization after the completion of the agreement.

Its profit has increased by 15% on its investment of $20.5 million in the Singaporean E-commerce organization. Lazada has raised $700 million in revealed financing in the past years, primarily from Summit Partners, Tengelmann Ventures, Temasek, Verlinvest and Kinnevik Investment.

As per reports by CNBC, Rocket Internet will spin off a 9.1% share in the companies for generating cash worth $137 million but will continue to own 8.8% of the stake.

British supermarket chain Tesco, which earlier held 19.6% of the equity of the company, will spin off 8.6% equity share in the German startup for $129 million. After further investment by Abruzzo, the conventional retailer will continue to own 8.3% stake.

Tesco stated it will use the funds generated from the transaction to arrange general working capital. As per reports by Reuters, the Hertfordshire based organization has been focused to revive its major grocery business in UK in the previous 2 years and begun spinning off its non-core divisions including its South Korea based business in 2015.

Alibaba has continuously been expanding its global presence in the electronic trading industry. In 2015, it injected over $100 million into Japan based online luxurious goods seller, led a half billion dollar fundraising round into the Indian online marketplace operator Snapdeal and increased its share in the Singaporean national postal service provider Singpost to 14.5%.

The agreement values the Singaporean web retailer at $1.5 billion. It would turn Alibaba into its controlling shareholder.

 
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Posted by on April 13, 2016 in Technology

 

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