Alibaba selling Sun Art stake for $1.6B
Chinese giant Alibaba for $ 1.6 bln to sell private equity DCP Capital its entire 78.7 % stake in Sun Art Retail Group, a leading Chinese hypermarket operation. It also includes divestment that Alibaba made this year and announced to quit a number of businesses to concentrate on its core business following heightened competition from rivals such as Pinduoduo.
Alibaba aimed to combine its technology with Sun Art’s large network of hypermarkets across China when it acquired a majority stake in Sun Art for $3.6 billion in 2020.
Alibaba has decided to divest from Sun Art which may represent a strategic shift, although Alibaba’s own share price is 85% higher year on year.
Alibaba on drive towards efficiency and shareholder value is also evidenced by its decision to sell Sun Art and divest Intime, a Chinese department store chain even for a loss.
