Three notorious Chinese billionaires have reportedly teamed up to form an online shopping company to compete with Alibaba.com, the largest Chinese e-commerce website, owned by the wealthiest man in China, Jack Ma. Experts discussed this development in a program on Bloomberg ands said that Chinese companies are quickly making their way to the mainstream markets.
Yahoo! Inc. (NASDAQ:YHOO) owns a 24% stake in Alibaba and any potential threat to the Alibaba group can increase worries of Yahoo because Alibaba is about to go public in the US and Yahoo! Inc. (NASDAQ:YHOO) is expecting Alibaba to take it out from the constant market declines.
The new company will be worth around $814 million. Dalian Wanda Group, Tencent Holdings, and Baidu Inc (ADR) (NASDAQ:BIDU) are partnering to take this initiative. The owners of the groups announced this decision in a joint statement in Shenzen on Friday. Eric Chemi said that there is a competition culture nurturing in China unlike the US, where billionaires are working in their own spaces without intervening and competing directly with each other.
Alex Sherman said that Chinese companies will come to the US eventually and will eye media and tech companies for their investments. He also said that in the coming three to four years, we will keep hearing the names of the big Chinese companies in the mainstream market news.
“[…] These Chinese companies are coming to the United States and Alibaba will have their IPO, it’s just going to be the beginning when they are going to start to take stakes in different US tech companies, it’s going to happen and these other Chinese companies are very interested in media and tech […],” said Sherman.
Yahoo! Inc. (NASDAQ:YHOO) will have to sell 40% of its shares in Alibaba in the IPO, which will provide an approximately $10 billion gain for Yahoo! Inc. (NASDAQ:YHOO).
Ken Griffin’s Citadel Investment Group owns more than 8.1 million shares of Yahoo! Inc. (NASDAQ:YHOO).