Alibaba Group Holding Ltd. on Tuesday announced it has reached a definitive agreement with Hong Kong Stock Exchange-listed Alibaba Health Information Technology Ltd.
Under the agreement, Alibaba Group will transfer the operations of its Tmall online pharmacy to Alibaba Health in consideration for newly issued shares and convertible bonds of Alibaba Health.
Currently, Alibaba Group owns an effective equity interest of approximately 38 percent in Alibaba Health. After the completion of the transaction, the group’s effective equity ownership of Alibaba Health will increase to approximately 53 percent and Alibaba Health will become a consolidated subsidiary of Alibaba Group.
“Health care will be a strategically important growth area for our ecosystem in the years to come, and we have a strong competitive advantage in this area,” Alibaba Group chief operating officer Daniel Zhang said. “Health care is especially important to Chinese consumers, and we expect that this integration will enable Alibaba Group to build a health care ecosystem that can utilize e-commerce, big data and other technologies to improve the health care supply chain and ultimately provide users with a better health care experience.”
Alibaba Group expects the transaction to be completed in the third quarter of 2015, subject to satisfaction of all closing conditions.