Alibaba Group (HK:9988) has reportedly put forward an offer of approximately $1.5 billion for the acquisition of Chinese grocery delivery platform Pupu. This bid significantly surpasses a competing offer from Sun Art Retail (HK:6808), which is said to be around $600 million, according to Bloomberg on Friday, citing individuals familiar with the matter.
This potential transaction signifies a strategic move by Alibaba to bolster its presence in China’s intensely competitive landscape of local commerce and online grocery delivery. The e-commerce giant is currently engaged in a market share battle with rivals such as Meituan (HK:3690) and JD.com (HK:9618).
The Bloomberg report indicates that Sun Art, a former affiliate of Alibaba now backed by private equity firm DCP Capital, had initially proposed roughly $600 million for Pupu.
The article also points out that Alibaba’s bid comes just months after Meituan finalized an agreement to acquire grocery platform Dingdong Fresh Holding for an estimated $717 million.
Pupu, headquartered in Fujian province, boasts annual revenues exceeding 30 billion yuan (approximately $4.2 billion). The company operates a network that provides grocery delivery within a 30-minute window across various Chinese provinces, Bloomberg has reported.
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