Alibaba Group Holding has made its largest overseas acquisition to date by buying a controlling stake in Lazada, an e-commerce company headquartered in Singapore, for one billion U.S. dollars. Alibaba will pay $500 million for new shares in the company and purchase an equal amount from the existing investors, which include Germany's Rocket Internet, Tesco and Investment AB Kinnevik.
For Alibaba, the Lazada deal adds sales of clothing and electronics in six growing Southeast Asian markets. Lazada, founded by Rocket Internet in 2012, operates in Singapore, Indonesia, Malaysia, the Philippines, Thailand and Vietnam. The acquisition is part of Alibaba's plans to expand further overseas, as the group currently remains dependent on China for more than 85 percent of its business.
Lazada reported $310 million in revenues for 2015, up by 78 percent on the previous year, but the growth came with a $334 million loss for the year, more than double the loss it had posted in 2014. Alibaba's acquisition values Lazada at $1.5 billion, Rocket Internet said in a separate statement. In the transaction, Credit Suisse advised Alibaba and Goldman Sachs advised Lazada.
