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Alibaba Group Holding Ltd (BABA) Hasn’t Developed Expensive Tastes Yet, Spending Less Than $0.5 Billion on Beijing Shiji Information Technology

Alibaba Group Holding Ltd (NYSE:BABA) has gone shopping for new opportunities after the world-record Initial Public Offering (IPO). The company is paying $457 Million for 15% Stake in Beijing Shiji Information Technology. The latter business is specialized in providing services and software to hotels, which spurs interest for the e-commerce titan in the form of enhancing its travel services provided through Taobao Travel, according to The Wall Street Journal. 1

Alibaba Group Holding Ltd (NYSE:BABA)’s price is about $88.8 a share after an almost 2% decline during the day, but this latest addition can do little to actually make the numbers spike violently as the total market capitalization for the group is $222.63 billion. Nevertheless, this will boost the company’s offerings and will complete the ones already available, making it one step closer to a monopolistic position in China. Earlier this year Alibaba Group Holding Ltd (NYSE:BABA) made one of the biggest acquisitions in the history of Chinese internet sector by buying UCWeb. The latter being focused on mobile, allows reaching customers easier.

There’s also Alipay that helps perform transactions on any of Alibaba Group Holding Ltd (NYSE:BABA) official websites. There were some issues related to the Alipay spin-off that caused investors to exhibit a grim demeanor, but Jack Ma stated that it was one of the hardest decisions that he had to take and the things have leveled off since as people did not lose faith in the company.

Most probably, by pursuing such a path of evolution, Alibaba Group Holding Ltd (NYSE:BABA) is establishing itself as a bridge between consumers and brick-and-mortar businesses. It is already the largest business-to-business portal with soaring traffic of an immense range of products, with relatively small revenues if compared to the flow of goods that they register, but with margins too attractive for investors to ignore. Most of the money that the company makes comes from advertisement and some little transaction fees. This series of latest acquisitions promise to fortify its position in China, then the giant might as well conquer the world.

Disclosure: none

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