Chinese e-commerce giant Alibaba is aggressively building a media and entertainment empire. The Jack Ma-led company is not just investing in digital media, it is following in the footsteps of Amazon founder Jeff Bezos. Bezos acquired the Washington Post for $250 million in 2013. Sources familiar with the matter told Bloomberg that Alibaba is in “advanced talks” to invest in what was once the world’s most profitable newspaper.
SCMP’s revenues have been declining for three years
People familiar with the matter told Bloomberg that a signing ceremony “will be announced soon.” On Nov. 09, China Daily had claimed that the Hangzhou-based company was in talks to invest in or acquire the South China Morning Post. Bloomberg didn’t provide the size of Jack Ma’s stake or financial details of the transaction. The Hong Kong-based SCMP Group’s revenues and profits have been declining for three years as readers shift online.
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The South China Morning Post is owned by Malaysian billionaire Robert Kouk since 1993. Responding to a question about his interest in buying the SCMP, Jack Ma said earlier this month that he was looking at “a lot of companies right now.” Internet heavyweights are investing in well-established brands even as print publishers continue to struggle. Facebook co-founder Chris Hughes had acquired a majority stake in the New Republic magazine in 2012.
Alibaba betting big on media business
The SCMP Group has been suspended from trading in Hong Kong since 2013. The Hong Kong stock exchange requires companies to have a minimum of 25% of shares held by minority investors in order to trade publicly. Besides its traditional newspaper, the SCMP Group also has operations in contract printing, magazines, and recruitment. Alibaba has invested in several media companies.
In June 2015, the e-commerce giant invested $194 million for a stake in China Business News (CBN), a Bloomberg-like financial news and data provider. Alibaba also acquired a stake in Enlight Media earlier this year. Last month, it partnered with the Chinese newspaper Sichuan Daily to launch an online media company. Earlier this month, the SCMP said its editor-in-chief Wang Xiangwei would step down at the end of this year. He will be replaced by his deputy Tammy Tam.