Alibaba buys out food delivery service Ele.me at $9.5B valuation
The Alibaba Group has announced that it will acquire the rest of online food delivery company Ele.me in a deal that values the company at $9.5B.
The Chinese tech giant first invested in Ele.me two years and currently owns close to 43% of the company’s voting shares along with its affiliates.
Get it while it’s hot
Founded by Mark Zhang and Jack Kang in 2008, Ele.me claims to be China’s biggest online delivery and local services platform, but at its core, it’s a logistics technology company that uses their logistics system to provide local delivery services.
With the deal, Ele.me will continue to operate under its own brand, and Mark Zhang will become chairman as Wang Lei, the current VP of Alibaba group, will take over as Ele.me’s CEO.
This is a part of Alibaba’s “new retail” strategy
This is the latest in a frenzy of investments and acquisitions by Alibaba as they look to grow their physical presence in the retail space.
Their plan is to combine e-commerce and offline retail to make it easier to move and spend cash between brick-and-mortar stores and Alibaba businesses.
With Ele.me, they look to complement Koubei, their affiliate local services platform, by combining Ele.me’s online home delivery services with Koubei’s consumer acquisition and engagement capability for restaurants.