Singapore Post Limited’s (SingPost) eCommerce logistics collaboration with Alibaba Group Holding Limited (Alibaba) was strengthened as Alibaba’s S$86.2 million investment in SingPost’s logistics subsidiary Quantium Solutions International (QSI) was completed, and regulatory approval for Alibaba’s second investment in SingPost was obtained.
Joint venture to strengthen eCommerce logistics network
SingPost completed the joint venture with Alibaba in which Alibaba has invested S$86.2 million for new QSI shares making up 34 per cent of QSI, with SingPost owning the remaining 66 per cent.
First announced on 8 July 2015, the joint venture is the culmination of deepening business ties between SingPost and Alibaba. Beginning as a customer of SingPost, Alibaba became a SingPost shareholder in 2014, and today, SingPost is a strategic logistics partner for Alibaba.
QSI, the joint venture between SingPost and Alibaba, will be a common platform to grow and enhance eCommerce logistics capabilities in Southeast Asia and Oceania, to better serve the region’s rapidly growing online retail markets.
The collaboration will focus on strengthening QSI’s end-to-end eCommerce logistics network, building scale for future profitability. QSI currently operates in 11 markets, providing a full suite of end-to-end eCommerce solutions that includes warehousing, fulfilment, and last mile delivery.
Mr Simon Israel, Chairman of SingPost said, “The completion of the QSI joint venture underscores the deepening relationship and commitment between both companies to build a leading eCommerce logistics platform together across the region. Both Alibaba and SingPost are confident in the long-term value of collaborating to serve the region’s fast rising eCommerce logistics needs.”
Mr Daniel Zhang, Chief Executive Officer of Alibaba Group, said, “Our enhanced collaboration with SingPost is another strategic step towards strengthening the fundamental infrastructure for digital commerce that will empower brands and retailers to sell globally through the Alibaba ecosystem. A robust logistics network is vital to helping our merchants successfully serve the vast population across Southeast Asia and Oceania, and realise Alibaba’s vision to ultimately serve two billion consumers worldwide.”
Update on second share placement
Approval from the Info-communications Media Development Authority (“IMDA”) has been obtained for Alibaba to increase its interest in SingPost to 14.4 per cent, from 10.2 per cent currently. Alibaba’s further investment of S$187.1 million into SingPost is targeted to be completed by 28 February 2017, in light of the timeline required to obtain the remaining approvals from SingPost’s shareholders at an Extraordinary General Meeting and from the Singapore Exchange for the listing, quotation and trading of new shares on the Main Board of the SGX-ST.