Alibaba doubles stake in China’s biggest hypermarket chain Sun Art Retail

Shopping carts are lined up at an entrance to an RT-Mart hypermarket, operated by Sun Art Retail, in Shanghai, China, October 19 2020. Picture: QILAI SHEN/BLOOMBERGAlibaba will invest about $3.6bn to double its stake in Sun Art Retail, taking control of China’s largest chain of hypermarkets to try to fend off rivals such as JD.com in e-commerce’s hottest growth arena.

The Chinese e-commerce giant is now grappling with intensifying competition from the likes of JD, food delivery giant Meituan Dianping and start-ups such as Tencent-backed Missfresh, all chasing a market for groceries and fresh produce that HSBC expects to grow 2.5 times to 690-billion yuan by 2022 from 2019. Alibaba was among the pioneers in that arena, announcing in 2017 it would spend about $2.9bn for a 36% stake of Sun Art.

As Alibaba increases its stake to a majority, Sun Art’s financial statements will be consolidated into the larger company’s. Peter Huang, Sun Art’s CEO, will add the title of chair for the business.

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