Alibaba Group Holding ADR shares were up 0.83% on Thursday morning after the retail giant agreed to a joint venture between its e-commerce operations and South Korea’s E-Mart Inc.’s e-commerce platform, Gmarket, as retail sentiment stayed cautious.
According to media reports, e-commerce assets of AliExpress Korea and Gmarket will join forces to form a 50-50 joint venture. The companies will reportedly invest additional funds into the JV, which will own 100% of Gmarket. The new e-commerce business is valued at about $4 billion, Bloomberg reported earlier.
According to a WSJ report, Shinsegae, the parent of E-Mart, expects Alibaba to enhance Gmarket services and customer experience. Retail sentiment on Stocktwits improved to ‘neutral’ compared with ‘bearish’ a week ago. One retail commenter was upbeat about a potential recovery on the cards.
Last week, a consortium consisting of Youngor Fashion and members of Alibaba’s Intime Stores' management team announced a deal to buy Intime Stores for 7.4 billion yuan. That transaction was part of Alibaba's strategy to combine its domestic and international e-commerce businesses and divest certain non-core assets.
The retail giant is set to book a $1.3 billion loss from the divestment. So far this year, Alibaba’s stock is up 15.
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