Alibaba sold its U.S. e-commerce portal 11Main to rival OpenSky. (Photo : Reuters)
With only over a year of operations, Chinese e-commerce giant Alibaba sold its U.S.-focused online commerce site 11Main to rival OpenSky. The move is part of a strategic deal that would allow Alibaba to secure a 37-percent share of the buying entity.
Through the deal, Alibaba shall transfer the ownership of 11Main, along with other e-commerce-related assets such as Auctiva, Vindio and SingleFeed, to OpenSky, a social marketplace that appears to provide assistance to lesser-known labels, as its website suggests.
OpenSky claims that it has over 50,000 merchant stores, five million subscribers and two million items available for purchase.
For industry experts, the agreement gives an opportune time for Alibaba to reap more profitable results, citing that the joint venture with OpenSky is a better business strategy than its struggling independent e-stores.
However, the Hangzhou-based e-commerce powerhouse did not disclose yet how much the deal was worth.
When it started its operations in 11Main, Alibaba envisioned a shop-window for startup U.S. merchants and brands. The move was part of the firm's intent to lessen its dependence on its home matket.
Nonetheless, it was considered that the 11Main operations were not a priority for the e-commerce company.
The recent strategic deal is also regarded as a means to draw attention to the difficulty of faring well in the U.S. e-commerce market. Amazon.com Inc. and eBay Inc. currently dominate the said market.
In the recent period, Alibaba has seen a slowdown in its earnings growth. While it continues to pour in investments overseas, it simultaneously beefs up its presence in the domestic arena.
