Chinese technology giant Alibaba Group Holding will invest another 2 billion Dollars in the South East Asia e-commerce company Lazada Group and will compete with rivals like the American Amazon, which is expanding actively in the region.
Taking into account the recent announcement, Alibaba has already invested a total of $4 billion on Lazada.
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Alibaba's stake will increase to an undisclosed amount following the latest investment, a spokeswoman told Reuters. Current Lazada chairman Lucy Peng will assume the role of CEO to drive growth strategies.
Alibaba initially acquired a controlling stake in Singapore-based Lazada in 2016 for an investment valued at $1 billion, then increased its stake further with another $1 billion investment a year ago, raising its total to $4 billion.
The region's internet economy is expected to grow to $200 billion by 2025, primarily driven by growth in e-commerce.
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Lazada will now be further integrated into the Alibaba ecosystem. Peng, one of the 18 founders and a senior partner in the Alibaba Group, said the region is a hot spot for growth and exciting opportunities.
"With a young population, high mobile penetration and just three percent of the region's retail sales now conducted online, we feel very confident to double down on Southeast Asia", said Peng, who is also the executive chair at Ant Financial. Global e-commerce giant Amazon entered the region previous year, but is so far active only in Singapore.
Launched in 2012, Lazada boasts more than 145,000 local and global sellers and 3,000 brands throughout Indonesia, Malaysia, Thailand, Vietnam and the Philippines.
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According to an official statement, Alibaba's decision to invest in Lazada will not only strengthen its business relationships but will help the Singapore based eCommerce firm explore the eCommerce tools & resources of Alibaba.