Alibaba turns its focus on health-care business as China rethinks health-related reforms. (Photo : Reuters)
Alibaba Group Holding Ltd. has purchased a $382-billion stake in Chinese production company Beijing Enlight Media Co., further cementing its place in the country’s entertainment industry.
In a filing to the Shenzhen Stock Exchange, Enlight Media said that it sold shares valued at 2.4 billion yuan to Hangzhou Ali Venture Capital Co., a subsidiary of Alibaba Group.
The company also stated its intention to sell an additional 400 million yuan of shares to Shanghai Enlight Investment Holdings Co., of which the chairman of Enlight Media is a majority shareholder.
Both Alibaba and Enlight declined to comment.
Alibaba has made a series of acquisitions in the entertainment sector, which is seen by analysts as a bid to increase its content in order to attract more users and revenue. China's biggest e-commerce company also faces competition from its other Chinese rivals, such as online gaming and social networking conglomerate Tencent Holdings, in gaining entertainment content via licensing and other enrichments.
Enlight Media has produced several successful films in recent years, including the 2013 comedy "Lost in Thailand," which earned nearly 1.27 billion yuan ($202 million) at the box office, and "The Breakup Guru," which grossed 665 million yuan ($106 million) in 2014, according to data from the Beijing-based film-research company EntGroup Inc.
The company also produces local television shows such as "Top Chinese Music" and "Chinese Entertainment Reports."
"Beijing Enlight Media has had a long track record of producing hit TV shows," said You Na, an analyst with the ICBC International Research Ltd. in Hong Kong. "Alibaba most likely will consolidate the previous video and content businesses it has already bought to expand its market share."
Enlight declined to disclose the share of ownership from the purchase, but its filing suggests the deal is for 99 million shares, according a report from the Wall Street Journal. The company has traded 531.2 million shares at the Shenzhen Stock Exchange, with another 481.5 million non-traded shares.
On Tuesday, Enlight Media's shares skyrocketed to their highest level since Oct. 2013. The stock rose as high as 9.5 on Wednesday hours prior to the statement to the Shenzhen exchange.
