China’s e-commerce giant, Alibaba Group has agreed to acquire AutoNavi, digital map content and navigation and location-based solutions firm in China for $1.5 billion.
Alibaba’s acquisition of AutoNavi will help it use its mapping technology for peer customer reviews of shops and restaurants under in the group to up its sales. Last year, Alibaba bought 28% stake in the company.
According to Mr. Congwu Cheng, the Company’s chairman and chief executive officer,”We believe that this transaction maximizes value for AutoNavi’s shareholders. We also believe that Alibaba is a great home for our employees and customers and that Alibaba will be able to provide us with great resources and strategic benefits to increase adoption of our location-based services in the China mobile Internet ecosystem.”
The deal, set to be closed in the Q3 this year will see the firm becoming a wholly-owned subsidiary of Alibaba, and its ADSs will no longer be listed on Nasdaq. AutoNavi’s comprehensive nationwide digital map database covers approximately 3.6 million kilometers of roadway and over 20 million points of interest across China. The firm also provides comprehensive, integrated navigation and location-based solutions optimized for the China market, including mobile location-based solutions and Internet location-based solutions, automotive navigation solutions, and public sector and enterprise applications.
Jonathan Lu, Chief Executive Officer of Alibaba says the firm is excited to work with the talented team at AutoNavi to further integrate mobile commerce into the lives of Alibaba’s consumers.
Lu said “As a result of this transaction, we believe AutoNavi will continue to be a strong player in an increasingly competitive map applications and local services market.”