Chinese juggernaut Alibaba Group Holding Ltd has announced its decision to sell a number of its online pharmacy business units in a new $1.35bn deal. Through the sale, Alibaba will gain up to HK$10.6bn in newly issued shares of Hong-Kong listed Alibaba Health, Alizila has reported.
Units which will move to the digital health subsidiary Alibaba Health from the company’s B2C platform Tmall Pharmacy will consist of a multitude of healthcare products and services, as well as medical devices, making this division its core healthcare arm.
“Healthcare is a strategically important area for Alibaba Group with strong growth potential. This transaction is a logical evolution for the continued development of Alibaba Health into our healthcare flagship platform,” explained Alibaba Group CEO Daniel Zhang.
“Alibaba Health’s knowledge and network, in combination with Alibaba Group’s consumer insights and technology, will enable us to create the best healthcare ecosystem in China.”
With rivals such as WeDoctor and Ping An Healthcare dominating recent headlines, it was only a matter of time before Alibaba followed suit to gain an edge over such a competitive market, cater towards ongoing consumer trends and support vendors to provide exceptional patient care across the industry.
“Alibaba Group has been very supportive to the development of Alibaba Health as the group’s flagship platform in the healthcare sector,” noted Alibaba Health CEO Leo Shen.
“The transaction strengthens Alibaba Health’s market leadership and recognises our contribution to the healthcare industry in China. It will allow us to expand our business by adding more complementary categories and enabling us to have deeper engagement with more participants.”
Upon completion, Alibaba will see its equity ownership and voting interest in Alibaba Health rise to 56.2% and 67.5% respectively.