NewAlibaba health care unit stumbles into 2016 as deal on online pharmacy business runs into delays
Alibaba Health Information Technology is the Hong Kong-listed healthcare subsidiary of e-commerce giant Alibaba Group
The expansion plans of Alibaba Health Information Technology, the Hong Kong-listed health care subsidiary of e-commerce giant Alibaba Group, have stumbled out of the gate this year as the US$2.5 billion deal to acquire its parent’s online pharmacy business gets delayed.
In a regulatory filing on Monday, Ali Health chief executive Wang Lei said “additional time is required for the relevant conditions” to complete that proposed acquisition.
Shares of Ali Health were down 5.97 per cent to close at HK$5.04, following the announcement.
“While the company remains committed to pursuing the proposed acquisition, there remains uncertainty regarding obtaining the required regulatory approvals,” Wang said.
That deal is subject to a number of conditions, including obtaining approvals from the independent shareholders of Ali Health and the Hong Kong stock exchange.
Ali Health said it reached agreement with Ali JK Investment, a subsidiary of New York-traded Alibaba, and Chen Wenxin -- the owners of Beijing Chuanyun Logistics Investment -- in extending the “long stop date” to meet those conditions to March 31, from the previous December 31 deadline.
Beijing Chuanyun is an offshore holding vehicle that controls Alibaba’s online pharmacy operations, which is run under internet shopping platform Tmall.com.