China's Alibaba Secures Management Rights of French Retailer 'Auchan'

Securing 77.02% Stake... Strategy to Break Down Boundaries Between Online and Offline Distribution
Alliance with Taobao, Expanding the E-commerce Ecosystem

[Asia Economy Beijing=Special Correspondent Jo Young-shin] Alibaba, China's largest e-commerce company attempting to break down the boundaries between online and offline retail, is expanding its offline business by acquiring a large supermarket chain.

Alibaba announced on the 20th through a disclosure on the Hong Kong Stock Exchange that it will invest 28 billion Hong Kong dollars (approximately 4.1 trillion Korean won) to increase its stake in Gaoxin Retail, the Chinese subsidiary of the French retail company Auchan, to 77.02%, thereby securing management control.

Previously, in November 2017, Alibaba had acquired a 36.16% stake in Gaoxin Retail, and it will now purchase additional shares from the founding family, who are the current largest shareholders and French nationals.

Under Gaoxin Retail, there are two supermarket brands: Darunfa (DRF-MART) and Aoshang. The total number of stores for these two brands in China reaches 481.

Gaoxin Retail stated that through this transaction, by strengthening its alliance with Alibaba's e-commerce platform Taobao, it will be able to benefit from Alibaba's e-commerce ecosystem.

By securing the operating rights of Darunfa and Aoshang stores across China, Alibaba has laid the foundation to provide integrated online and offline distribution services to many more local consumers than before.

Currently, customers living near Hema Xiansheng stores in China can order fresh foods such as fish, meat, and vegetables through an application (app) and receive the goods directly at home; similar services could become available at Darunfa and Aoshang supermarkets as well.