Attendees pass by an Alibaba.com display at CES 2019 in Las Vegas.
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Alibaba said Friday it will acquire a cross-border e-commerce business unit, Kaola, from the Nasdaq-listed Chinese internet company NetEase for about $ 2 billion.
Kaola sells imported products in China that include clothes, consumer electronics, and sports accessories. It is one of the largest Chinese e-commerce sites focused on selling imported goods in the country, alongside Alibaba's Tmall Global and JD.com's JD Worldwide.
Alibaba said it plans for Kaola to continue operating independently under its current brand, but it will have a new leader at the helm. Tmall Import and Export General Manager, Alvin Liu, will take over as CEO.
With Tmall Global and Kaola, Alibaba will have a massive market presence in the cross-border e-commerce sector.
With Alibaba's acquisition of Kaola and its investment in NetEase Cloud Music, NetEase can "further optimize its costs while Alibaba strengthens its leadership in cross-border ecommerce," Jefferies analysts wrote in a note on Friday.
China is one of the largest e-commerce markets in the Worldwide, with research firm eMarketer predicting a June report that in 201
Daniel Zhang, chief executive officer of Alibaba Group, said in a statement that the company is confident about the future of China's import e-commerce market which it said, "remains in its infancy with great growth potential."
"With Kaola, we will further elevate the import service and experience for Chinese consumers, "added in a statement.
Earlier this year, reports said Amazon's Chinese joint venture was in talks to merge with Kaola.
Last month, Alibaba reported better-than-expected revenue and earnings for its June quarter but sales growth slowed.
The company's core commerce business, which includes its Tmall and Taobao shopping platforms, and its booming cloud division contributed to growth. Annual active consumers on Alibaba's China retail marketplaces reached 674 million, and a jump of 20 million and most of those new consumers were said to be from less-developed cities.
Alibaba, along with Yunfeng, will also invest about $ 700 million in NetEase's music streaming service, NetEase Cloud Music, the companies said.