Alibaba expands Asian footprint with $250m investment in SingPost

The Chinese e-commerce giant will use its 10 percent stake to tap into the Singapore national postal service's regional infrastructure.

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SingPost/Alibaba

Alibaba, the Chinese e-commerce juggernaut that's part-owned by Yahoo, has made a S$312.5 million ($250 million, AU$270 million) investment in Singapore's national postal service, SingPost, the companies announced today.

The deal, inked yesterday, will give Alibaba a 10 percent stake, and the two companies also signed a memorandum of understanding (MOU) for an upcoming joint venture regarding international e-commerce logistics.

With e-commerce sales in the Asia Pacific region expected to hit $1 trillion by 2017, Alibaba hopes to tap into SingPost's regional infrastructure and international logistics capabilities for its Taobao site, perhaps as a first step to becoming a more global operation.

Taobao is famous for having great prices on everything under the sun, but notorious for being very hard to use if you live outside of China. Customers usually pay a shipping agent to order and ship the product out of the country.

While Taobao does have a Southeast Asia version that guides non-Mandarin speakers into ordering online, it's still a convoluted process that will drive away users who are more used to websites such as Amazon.

By tapping into SingPost's infracture, Taobao could potentially make it much easier for customers to order and ship products to the region, thereby increasing its market presence outside of China.

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