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Russia: Alibaba Expands into Russia

 |  September 11, 2018

Alibaba, the Chinese eCommerce giant, inked a deal Tuesday, September 11, with the Russian Direct Investment Fund and Mail.ru Group to create AliExpress Russia.

According to a report in Bloomberg, Alibaba is creating a US$2 billion joint venture to boost its eCommerce business in Russia, with local investors controlling the joint venture. Bloomberg reported that Alibaba will add its domestic operations of Tmall and AliExpress into the joint venture, with Mail.ru owner Alisher Usmanov’s MegaFon selling its 10% stake in Mail.ru to Alibaba for 24% of the new venture.

 “A big part of what we’ve been able to develop so far in Russia has been our cross-border business,” Alibaba President Mike Evans told reporters, according to Bloomberg. “But the future, which will require the presence of our partners at this table, will involve building a much bigger local business.”

Bloomberg reported that Alibaba will access Mail.ru’s audience via two social networks in the country. Pandao, a mobile platform for selling Chinese goods in Russia, will also be rolled into the Alibaba venture. The report noted that the Russian Direct Investment Fund will add funding in return for a 13% stake, while Mail.ru gets the remaining 15%. It’s not clear how much the Russian Direct Investment Fund is adding to the joint venture, noted the report.

 Full Content: Bloomberg
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