In brief: Alibaba doubles down on Russia

Alibaba is setting up a US$2 billion joint venture with billionaire Alisher Usmanov’s internet services firm Mail.ru to strengthen the Chinese company’s foothold in Russian ecommerce.

Asia’s most valuable company signed an accord Tuesday with Mail.ru to merge their online marketplaces in the nation of more than 140 million people. The deal is backed by the Kremlin through the Russian Direct Investment Fund and the local investors will collectively control the new business.

Source: Bloomberg

The deal focuses on AliExpress, a marketplace made up mainly of Chinese merchants that’s popular in Russia and across Latin America. AliExpress opened up to Russian vendors in 2015.

The deal – which includes Alibaba taking a 10 percent stake in Mail.ru – will help the Chinese firm and its Russian partner to compete against local rivals, including Yandex.

“Our experience in China and other markets around the world makes us uniquely qualified to help build the future infrastructure of commerce in Russia and neighboring countries,” said Alibaba president Michael Evans at the signing ceremony at the Eastern Economic Forum in Vladivostok, as quoted in the firm’s corporate blog.