HANGHZHOU: The Alibaba Group has increased its stake in Singapore Post (SingPost) by five percent to 14.51 percent at a cost of US$138.6 million.
The company has also agreed to invest a further US$67.85 million for a 34 percent shareholding in SingPost's Quantium Solutions International (QSI), which operates runs a logistics and fulfillment network throughout the Asia Pacific region.
Under the agreement QSI will become a joint venture between SingPost and Alibaba Group with QSI providing e-commerce warehousing, last-mile delivery and other end-to-end e-commerce solutions.
While Alibaba currently derives less than five percent of its revenue from outside China, executive chairman Jack Ma said his goal is for cross-border e-commerce to eventually produce 50 percent of the group's revenue.
The company "started as our customer and then last year became our shareholder and business partner," said SingPost group executive officer Wolfgang Baier in a statement. "We are now taking the next step by building a regional e-commerce logistics platform and infrastructure for e-commerce players across Asia Pacific, based on Quantium Solutions."
SingPost chairman Lim Ho Kee added: "As a postal service provider, we are on a burning platform, facing a global decline in mail revenue with trends like e-substitution and lifestyle changes." Lim called the partnership with Alibaba "a win-win situation for both of us because we share similar goals and have a natural fit between our operations across Asia".
Alibaba group CEO Daniel Zhang noted the new venture with SingPost will provide global brands and merchants with convenient access to China and at the same time help Chinese businesses sell and ship worldwide.