Alibaba to create a new cultural and entertainment group, launch 10bn yuan investment fund
UCWeb chief executive Yu Yongfu will run the new group, while Youku founder Victor Koo will oversee a new 10 billion yuan fund
Alibaba Group Holding has said that it will create a separate cultural and entertainment group, and will also raise 10 billion yuan for an investment fund targeting China’s cultural, media and entertainment sectors, according to reports.
Alibaba, which owns the South China Morning Post, has been expanding its operations into the leisure and entertainment industry in recent years though both acquisitions and founding new businesses.
The new cultural and entertainment group will include video streaming site Youku Tudou, browser company UCWeb, Alibaba Pictures, Alibaba Music, Alibaba Sports and Alibaba Digital Entertainment among others, mainland media reported on Monday, citing an internal letter by Alibaba chief executive Zhang Yong.
Yu Yongfu, formerly chief executive of UCWeb will lead the group, reporting directly to Zhang.
Victor Koo, who cofounded Youku, and ran the merged Youku-Tudou, will run capital raising and management for the investment fund.
Alibaba bought Youku-Tudou last year, and UCWeb in 2014.
“The cultural and entertainment ecosystem would integrate Alibaba’s e-commerce, finance, logistics and cloud ecosystems to make the whole Alibaba ecosystem more rounded, offering a better rounded experience and service for Alibaba’s users and clients,” the letter said according to the reports.
Reuters reported that Alibaba had confirmed that the investment fund would be over 10 billion yuan, and that the fund would be used across its digital media and entertainment businesses, without offering specific examples.
Alibaba is set to announce its third quarter earnings on Wednesday, with analysts expecting another strong quarter of sales.
Alicia Yap, the head of regional internet research at Citi Research, predicted in a report that Alibaba’s total second-quarter revenue for its fiscal year that ends in March would increase about 50 per cent year on year.