Alibaba acquires rest of UCWeb to boost mobile offerings

Alibaba Group, China's largest e-commerce operator, has agreed to acquire the rest of UCWeb to add internet browsers and an application store to its mobile service.

The cash-and-stock deal will see 3,000 workers join Alibaba as the business is fully integrated, the companies said in a joint statement yesterday.

Alibaba, which already had a 66 per cent economic stake in UCWeb, said the valuation for UCWeb surpasses the US$1.9 billion paid by Baidu for 91 Wireless last year as China's biggest internet deal.

Billionaire Jack Ma Yun's Alibaba and UCWeb are collaborating in areas such as payment, search and gaming services as competition intensifies in China, the biggest market for smartphones. UCWeb is boosting spending to challenge Tencent Holdings and Baidu as a surge in mobile use drives demand for games, apps and the platforms to deliver them.

"UC is an important factor in China's industry today," Ma said in a letter to Alibaba employees.

"It has shown strength in international development and we believe the integration of UC and Alibaba will bring more change and imagination to the industry."

Ma, executive chairman of Hangzhou-based Alibaba, joined UCWeb's board in August. The 66 per cent stake was held through convertible preferred shares, according to a filing in May.