Home HRCompany Profiles SingPost and Alibaba Group to expand ecommerce logistics cooperation

SingPost and Alibaba Group to expand ecommerce logistics cooperation

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  • Pic_SingPost eCommerce Logistics HubSingPost and Alibaba Group taking next step to establish end-to-end ecommerce logistics platform – Alibaba investing in Quantium Solutions International, a SingPost subsidiary
  • Alibaba Group to increase equity stake in SingPost to 14.51 percent subject to regulatory approval
  • SingPost and Alibaba Group to enter into a joint strategic business development framework to improve efficiency and integration in ecommerce logistics

SINGAPORE, 8 July 2015 – Singapore Post Limited (“SingPost”) (STI: S08) and Alibaba Group Holding Limited (“Alibaba”) (NYSE: BABA) announced today a series of new initiatives for collaboration and growth following the signing of a joint venture agreement. The three initiatives signal the deepening of a business relationship that started last year and a commitment from both parties to increase ecommerce logistics collaboration in the future to build a leading ecommerce logistics platform to service the rapidly growing ecommerce businesses across Asia Pacific and beyond.

Initiative One: Alibaba will invest up to approximately S$92 million (US$67.85 million) in QSI for a 34 percent stake in Quantium Solutions International (“QSI”), SingPost will hold the remaining 66 percent of the equity of QSI. QSI is currently a wholly owned subsidiary of SingPost providing leading end-to-end ecommerce logistics and fulfilment services across the Asia Pacific region. Its network spans more than 10 countries and the company offers customers ecommerce logistics solutions and warehousing across Asia Pacific.

QSI will reorganize its business and become the joint venture vehicle of SingPost and Alibaba Group. This will allow QSI to ramp up its development of ecommerce logistics infrastructure and services. In addition, QSI will also become a platform for both parties to strengthen their collaboration and realize synergies across their businesses. QSI will encompass ecommerce warehousing, last mile delivery and other end-to-end ecommerce solutions.

Initiative Two: Alibaba Group will purchase 107, 553, 907 new ordinary shares amounting to 5 percent of the existing share capital of SingPost for S$187.1 million (US$138.6 million). Upon completion, Alibaba’s deemed interest on a fully diluted basis in SingPost will rise from 10.23
percent to 14.51 percent. Alibaba Group’s acquisition of additional equity in SingPost is subject to Info-Communications Development Authority of Singapore (IDA) and SingPost’s shareholder approvals. Alibaba Group acquired its initial stake in SingPost in 2014.

Initiative Three: SingPost and Alibaba have also entered into a joint strategic business development framework to further improve efficiency and integration of ecommerce logistics solutions. SingPost and Alibaba will share their respective knowledge and leverage each other’s strengths to scale across the ecommerce logistics value chain. A joint Steering Committee will be created and drawn from their respective executives.

Mr. Lim Ho Kee, Chairman of SingPost, said: “The pace of transformation at SingPost has been accelerating steadily. As a postal service provider, we are on a burning platform, facing a global decline in mail revenue with trends like e-substitution and lifestyle changes. It is a win-win situation for both of us because we share similar goals and have a natural fit between our operations across Asia. On behalf of my fellow directors, I welcome Alibaba as one of our partners on the next phase of the journey.”

Mr. Daniel Zhang, Chief Executive Officer of Alibaba Group, said: “Over the past year, Alibaba and SingPost have worked closely to explore cross border ecommerce opportunities and created a series of customized logistics solutions in various markets. This additional investment into SingPost and establishment of a joint venture signify our commitment in expanding our global logistics footprint, which in turn will help Chinese businesses sell, and global brands deliver more easily around the world.”

Dr. Wolfgang Baier, Group Chief Executive Officer of SingPost, said: “We are now taking the next step by building a regional ecommerce logistics platform and infrastructure for ecommerce players across Asia Pacific based on Quantium Solutions – our ecommerce logistics subsidiary. Alibaba started as our customer and then last year became our shareholder and business partner. Today with the significant growth in ecommerce ahead, both of us are convinced of the long term value of working together in a win-win partnership for ecommerce businesses in Asia Pacific.”


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