Hangzhou Yunxi Investment Partnership Enterprise will pay $1.05 billion for a 20 percent stake in Wasu Media Holding Co. Ltd. Yunxi, an investment vehicle established by Alibaba co-founders Simon Xie and Jack Ma and Giant Interactive Group Inc.’s founder Shi Yuzhu, was established on April 2 and received a loan from Alibaba Group Holding Ltd. to help make the purchase.
Alibaba first partnered with Wasu Media in July 2013 when the two companies teamed up to launch a television set-top box. The set-top box used an operating system developed by Alibaba and hardware developed by Wasu. In March, Alibaba continued to enter China’s video and media industries by purchasing a 60 percent stake in television and film production firm ChinaVision Media Group Ltd. for $804 million. Now, Alibaba—through coordination with Yunxi—hopes to expand into the digital-content market with Wasu.
The announcement of the deal comes as Alibaba aims to bolster its image before its initial public offering (IPO), which is expected to raise $15 billion when it takes place later this year. Aside from making investments in the video and media industries, Alibaba has also taken on its main competitor Tencent by investing in department-store operator Intime Retail Group Co. and messaging app Tango.