Alibaba entered a strategic partnership with Russian e-commerce, social media and gaming platforms companies, which will form a new e-commerce platform using Russia’s payment system. The deal, signed at the Eastern Economic Forum (EEF) in Vladivostok, Russia, includes the sovereign wealth fund of Russia, the Russian Direct Investment Fund (RDIF), alongside mobile operator MegaFon and Russia’s top internet company, group Mail.ru.
The partnership aims to integrate Russia's key consumer internet and e-commerce platforms and launch a social commerce joint venture in Russia. The partners want to deliver expanded online services to Russian consumers and give Russian small and medium-sized businesses a greater access to local and international markets.
The idea is to create a one-stop destination for consumers to communicate, socialise, shop, and play games, all within the same online ecosystem.
AliExpress Russia, the company’s local e-commerce arm, will be contributed to the partnership. The Chinese company will cede control of its Russian business to form the partnership, which could enable Alibaba to reach out to a larger audience in Russia. Alibaba Group President Michael Evans called the joint venture “an exciting step in Alibaba’s international expansion.”
Upon completion of the deal, Alibaba Group will control 48% of AliExpress Russia, MegaFon 24%, Mail.ru 15% and the Russian Direct Investment Fund (RDIF) 13%. The transaction is expected to close in the first quarter of 2019.
The agreement will use Russia`s payments system known as Mir, which was developed in late 2014.
Picture: Sergei Konkov/TASS
