Alibaba Invests $1 Billion in SE Asian Lazada

Chinese e-commerce and trading platform has announced that it has bought a $1bn controlling stake in Lazada, an e-commerce trading platform in Southeast Asia.

It is expected that the purchase will help brands and distributors around the world that already do business on the Alibaba platform as well as local merchants access the Southeast Asian consumer market.

Lazada has e-commerce platforms in Malaysia, Indonesia, the Philippines, Thailand, Singapore and Vietnam. Between them the six countries have around 560 million in population and an internet user base of around 200 million according to Internet Live Stats. However only 3% of total retail sales are conducted online, and this suggests that Southeast Asia has a huge growth potential for both companies as internet penetration rises.

“Globalization is a critical strategy for the growth of Alibaba Group today and well into the future,” said Michael Evans, President of Alibaba. “With the investment in Lazada, Alibaba gains access to a platform with a large and growing consumer base outside China, a proven management team and a solid foundation for future growth in one of the most promising regions for eCommerce globally. This investment is consistent with our strategy of connecting brands, distributors and consumers wherever they are and support our ecosystem expansion in Southeast Asia to better serve our customers.”

Max Bittner, CEO of Lazada Group added: “We are very excited about joining forces with Alibaba and see significant synergies that will drive great benefits to our customers in Southeast Asia. Southeast Asia is an attractive mobile-driven consumer market that is highly fragmented and diverse with significant barriers to entry and a nascent modern retail sector that has large headroom for growth.”

“Furthermore, leveraging Alibaba’s unique knowhow and technology will allow us to rapidly improve our services and provide an even more effortless shopping and selling experience.”