Alibaba buys NetEase’s Kaola for US$2 billion to create China’s biggest cross-border e-commerce platform

Chinese e-commerce giant Alibaba Group has acquired Kaola from gaming and entertainment giant NetEase for about US$2 billion, creating the largest cross-border e-commerce platform in the country, according to a statement from Alibaba on Friday.

Kaola will continue to operate independently under its current brand and Alvin Liu, the import and export general manager of Tmall, one of the largest third-party online e-commerce platforms for brands and retailers in the world under Alibaba, will serve as Kaola’s new chief executive officer

“With Kaola, we will further elevate import services and the experience for Chinese consumers through synergies across the Alibaba ecosystem,” Daniel Zhang, chief executive of Alibaba Group, said in the statement.

China’s cross border e-commerce market was expected to reach 10 trillion yuan (US$1.4 trillion) by the end of 2019 as the country’s E-commerce Law came into effect earlier this year, aimed at nurturing the healthy development of the industry, according to a report released in August by Chinese market research company iiMedia Research.

In the first half of 2019, Kaola and Tmall Global were China’s largest and second-largest cross-border e-commerce platforms with a market share of 27.7 per cent and 25.1 per cent respectively, iiMedia Research said.