Update | Alibaba's buyout of Ele.me leaves Baidu with clean plate to focus on artificial intelligence
Baidu has been remaking its internet search business to focus on AI-related businesses, including autonomous cars
Baidu may be poised to exit the food-delivery business after almost four years as Alibaba Group Holding is said to have proposed buying out other shareholders of Ele.me, potentially freeing resources up for the internet search engine operator in its transformation into an artificial intelligence company.
Alibaba, China’s biggest e-commerce services provider, plans to acquire the rest of Shanghai-based Ele.me, as part of its New Retail strategy, according to a person familiar with the proposal, asking not to be identified as the discussions are private. The talks are still preliminary and an acquisition may not happen, the person said.
Hangzhou-based Alibaba is currently offering US$9.5 billion to acquire Ele.me, Chinese tech news site 36kr.com earlier reported. Alibaba declined to comment on the reported acquisition. Representatives for Baidu and Ele.me did not immediately comment.
The New Retail concept, pioneered by Alibaba founder and executive chairman Jack Ma Yun, refers to the integration of online and offline experiences for consumers, be it shopping, food delivery or buying groceries. Since last year, Alibaba has splashed out billions, investing in both offline and online retail companies such as Suning, Intime Retail, Sanjiang Shopping Club, and Lianhua Supermarket.
For Baidu, an exit from food delivery would take place at a time when it is stepping up efforts to remake its dominance of China’s internet search business into the country’s leading investor in artificial intelligence, with applications from big data analysis to autonomous driving.
The online search giant, led by founder and chief executive Robin Li Yanhong, recently displayed its autonomous cars during the widely watched Lunar New Year Gala.