Left: SingPost subsidiary Quantium Solutions
Alibaba Group is looking to increase its shareholding in Singapore Post (SingPost) and its subsidiary Quantium Solutions International (QSI).
The two companies formed a strategic partnership in June 2014, which included Alibaba acquiring a 10% stake in the group. It is now looking to increase this to nearly 15% with the acquisition of 107,553,907 shares for S$187.1m (US$138.6m). Alongside this, Alibaba will invest up to approximately S$92m (US$67.9m) in QSI for a 34% equity stake in the subsidiary. SingPost will hold the remaining 66%.
QSI provides end-to-end e-commerce logistics and fulfillment services across the Asia Pacific region, servicing more than 10 countries. The company will now reorganize its business and become the joint-venture vehicle of SingPost and Alibaba Group, providing e-commerce warehousing, last-mile delivery and other end-to-end e-commerce solutions.
To further strengthen the integration and working dynamics of the two groups, SingPost and Alibaba have entered into a joint strategic business development framework; they will share their respective knowledge and will leverage each other’s strengths across the e-commerce logistics business. As such, a joint steering committee will be created from a selection of executives from the two firms.
Lim Ho Kee, chairman of SingPost, said, “The pace of transformation at SingPost has been accelerating steadily. 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. It is a win-win situation for both of us because we share similar goals and have a natural fit between our operations across Asia. On behalf of my fellow directors, I welcome Alibaba as one of our partners on the next phase of the journey.”
Daniel Zhang, CEO of Alibaba Group, said: “Over the past year, Alibaba and SingPost have worked closely to explore cross border e-commerce opportunities and created a series of customized logistics solutions in various markets. This additional investment into SingPost and the establishment of a joint venture signify our commitment in expanding our global logistics footprint, which, in turn, will help Chinese businesses sell, and global brands deliver more easily, around the world.”
Wolfgang Baier, Group CEO of SingPost, said, “We are now taking the next step by building a regional e-commerce logistics platform and infrastructure for e-commerce players across the Asia Pacific region based on Quantium Solutions our e-commerce logistics subsidiary. Alibaba began as our customer, and then last year became our shareholder and business partner. Today with the significant growth in e-commerce ahead, both of us are convinced of the long-term value of working together in a win-win partnership for e-commerce businesses in Asia Pacific.”
July 8, 2015