China's Alibaba to take $4.6-billion stake in retailer Suning

BEIJING: China's largest online retailer Alibana and home-appliance giant Suning have signed a deal according to which the e-commerce leader will invest USD 4.63 billion for a near-20 per cent stake, and will work together on online and high-street sales, the two companies said today.

New York-listed Alibaba will invest about 28.3 billion yuan (USD 4.63 billion) in Suning to become its second-largest shareholder, while Suning will buy no less than 27.8 million new shares of Alibaba for 14 billion yuan (USD 2.33 billion), the company said.

"Both sides will raise overall efficiency by linking online and offline businesses to provide better commercial services to Chinese and overseas customers," Alibaba said in a statement, without specifying a timeframe.

Suning, one of China's biggest consumer electronics retailers which operates 1,600 stores in more than 280 cities, was established in eastern China's Jiangsu Province in 1990 and was listed on the Shenzhen Stock Exchange in 2004.

Trading of Suning's shares was suspended a week ago as it planned this round of non-public offering.

Trading will resume tomorrow, it said in a statement filed to the Shenzhen bourse, state-run Xinhua news agency reported.

The deal is the latest in a series of acquisitions by Alibaba as its founder and executive chairman Jack Ma tries to diversify. It faces domestic competition from Internet giants Baidu and Tencent.