(ECNS) — Alibaba is to spend $9 billion to acquire a 100 percent share in food delivery service Ele.me and integrate it with its own affiliate Koubei for a bigger piece of the online-to-offline (O2O) sector, reports 21st Century Business Herald.
Speculation on the acquisition has been in the air since July, but Alibaba declined to comment on the latest news, according to the report. Ele.me called it "pure fabrication".
Liu Xingliang, an Internet business analyst, said Alibaba has continued using buy-outs as an investment strategy.
In August 2016, Alibaba invested $900 million and its Internet finance arm Ant Financial $350 million into Ele.me. Last April, Alibaba and Ant Financial injected more investment to become the largest shareholder, accounting for 31.94 percent.
The online giant has clearly stepped up its battle with other web-based providers of neighborhood services. Fan Chi, CEO of Alibaba's offline service arm Koubei, made it clear that the goal is increasing customer visits to brick-and-mortar stores.
Zhang Yi, head of Guangzhou-based consultancy iiMedia Research, said Alibaba aims to transform itself by empowering offline stores and connecting them with online services to capture a slice of the retail sector.
