Alibaba.com has entered into an agreement to acquire China Civilink, which operates in China as HiChina Web Solutions, for a total consideration of RMB539.98m (approximately US$79.06m) in cash upon completion of two phases.
According to the terms of the deal, Alibaba.com will acquire 85% of HiChina for RMB435.42m (US$63.75m) with an additional 14.67% retained by the founders of HiChina. Dependent upon HiChina reaching certain performance targets, its founders can opt to sell their 14.67% equity interest in HiChina to Alibaba.com over the next three years for an additional consideration of RMB104.56m (US$15.31m).
HiChina is a provider of Internet infrastructure services in China, including domain name services, web and server hosting services, email hosting services and website design and development services.
With the acquisition of HiChina, Alibaba.com aims at having a larger customer base, new, value-added applications, advanced “do it yourself” website technology and a stronger management and operating team.
Commenting on the deal, David Wei, CEO of Alibaba.com said “When we went public, we set on a course to seek investment opportunities to grow our customer base and acquire additional technology and new applications to achieve our vision. HiChina is a strategic fit with that vision. With the support of the seasoned and highly capable executive team at HiChina, I am confident that our complementary businesses will create synergy and expedite our transformation from ‘Meet at Alibaba’ to ‘Work at Alibaba'”.
The acquisition is expected to close by the end of the year. HiChina, which currently employs more than 550 staff, will become a subsidiary of Alibaba.com retaining its own brand name and operations.
FinSMEs
28/09/2009