China's Ant Group has sealed a deal to acquire a 5% stake in the Brazilian loyalty program Dotz, according to a securities filing on Wednesday.
Dotz and Alibaba's payment affiliate Ant Group have also signed a business cooperation agreement, in which both companies explore, for instance, new opportunities for digital financial services in Brazil.
Dotz has just launched an initial public offering of roughly 815 million reais ($146.35 million) and plans to start trading on the Sao Paulo stock exchange on May 13.
Dotz set its price range between 16.20 reais and 21.40 reais per share. If it prices the IPO at the top of the range, Dotz may be valued at up to 3 billion reais.
The Brazilian company said the deal depends on the conclusion of the IPO.
According to the deal terms, Ant will appoint an executive to Dotz's board of directors, as well as the co-head of the company's committee of strategy.
Ant Group will also have an option to buy an additional 10% stake in Dotz in up to 24 months after the IPO.
Founded nearly 20 years ago, Dotz has 20 million active users. Besides a loyalty program, it is a marketplace and a financial startup.
BTG Pactual, Itau BBA, Credit Suisse and UBS BB are managing the IPO.
($1 = 5.5687 reais)