The Alibaba Group, the Chinese e-commerce juggernaut, will buy the rest of the mapping and navigation company AutoNavi Holdings that it did not already own, the latest in an acquisition spree ahead of Alibaba’s expected listing in the United States.
Alibaba will pay $5.25 a share to AutoNavi stockholders or $21 per American depositary share, for the 72 percent of the company that it does not already own, AutoNavi said in a statement on Friday. The deal values AutoNavi at $1.5 billion.
Last May, Alibaba had taken a 28 percent stake in AutoNavi, which holds a rare mapping license from the Chinese government covering 2.2 million miles of roads in China.
Alibaba, already China’s largest e-commerce company, has been especially keen to build up its mobile offerings in China, where smartphone use is surging. Integrating AutoNavi into its e-commerce sites would allow Alibaba to deliver location-specific discounts or services to its shoppers, analysts have said, or collect more detailed data on its customers’ spending habits.
Over all, online commerce in China is growing about 60 percent a year, compared to about 10 percent in the United States, Baidu’s chief executive, Robin Li, said at a Beijing news conference last month.
Alibaba has been spending aggressively to fend off rivals in China’s increasingly crowded e-commerce market, like Tencent, whose offerings span media, entertainment, Internet and mobile services. Another rival is Baidu, which owns China’s biggest Internet search engine and is increasingly pushing into Alibaba’s e-commerce turf.
“We are excited to work with the talented team at AutoNavi to further integrate mobile commerce into the lives of our consumers,†Jonathan Lu, Alibaba’s chief executive, said in a statement. “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.â€
The deal gives AutoNavi shareholders a 27 percent premium over the company’s closing price on Feb. 7, the last day the company’s shares traded on the market before it announced it had been formally approached by Alibaba.
Alibaba’s latest acquisition is the latest in a string of deals in China and beyond as it prepares for a highly anticipated initial public offering in New York later this year that could value that company at about $200 billion.
In March, Alibaba said it would pay nearly $700 million for a minority stake in a Chinese department store operator. That came 10 days after Alibaba said it had invested $280 million in the Silicon Valley mobile messaging app-maker, Tango.
The AutoNavi deal is expected to close in the third quarter. AutoNavi was advised by Lazard, and Alibaba was by Deutsche Bank.
