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China's Lianhua Supermarket says Alibaba takes 18 percent stake
May 29, 2017 / 5:48 AM / 5 months ago

China's Lianhua Supermarket says Alibaba takes 18 percent stake

HONG KONG (Reuters) - China’s Lianhua Supermarket Holdings Co Ltd on Monday said shareholder Shanghai Yiguo E-Commerce Co Ltd would sell an 18 percent stake in supermarket chain operator to a unit of Alibaba Group Holding Ltd.

FILE PHOTO: People ride a double bicycle past a logo of The Alibaba Group at the company's headquarters on the outskirts of Hangzhou, Zhejiang province November 10, 2014. REUTERS/Aly Song/File Photo

Lianhua said Shanghai Yiguo would transfer 201.53 million domestic shares to Alibaba (China) Technology Co Ltd. It did not provide a value.

Based on Lianhua’s stock price as of Monday afternoon trade, the deal could be worth HK$782 million (78.21 million pounds), Reuters calculations showed.

Shanghai Yiguo also agreed to sell 22.39 million shares, or about 2 percent of Lianhua, to Bailian Group Co Ltd, Lianhua said in a filing to the Hong Kong bourse.

In February, Alibaba formed a strategic partnership with Bailian Group, the largest retailer by store numbers to join the e-commerce giant’s drive to use big data to improve and profit from brick-and-mortar sales.

Trading in Lianhua shares, which was suspended late on Monday morning, resumed in afternoon trade. The share price surged over 30 percent to its highest since September 2015 at HK$4.21 prior to the trading halt. The stock trimmed gains when trade resumed but was still up 23.5 percent at HK$3.89.

Reporting by Donny Kwok

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