Bloomberg News reported on Thursday that Alibaba Group Holding (NYSE: BABA) is planning its first major investment since paying a record antitrust punishment as part of a crackdown on the Jack Ma-led corporation.
What happened was this: Alibaba has teamed up with the provincial government of Jiangsu, among others, to purchase a share in Suning’s retail unit, in a move that might help Alibaba gain a competitive advantage over rival JD.com Inc. (NASDAQ: JD).
Also see: Ant, Alibaba’s consumer finance firm, receives regulatory approval in China.
The deal, which is expected to close soon, would add to Alibaba’s existing 20 percent interest in Suning, one of China’s largest retailers of appliances, electronics, and other consumer products. According to Bloomberg, the corporation owned by Chinese billionaire Zhang Jindong is worth $8 billion.
Why It Matters: According to the story, the purchase requires permission from the State Administration for Market Regulation, China’s increasingly strong antitrust enforcer, and might be disclosed this week. The development is considered as a break from China’s antitrust woes, which culminated in a record $2.8 billion penalties for antitrust offenses.
Alibaba shares ended the day 1.16 percent lower at $226.78 on Wednesday.
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