Alipay buys fund manager to boost online services
October 31, 2013 Category Uncategorized
The online payment affiliate of e-commerce company Alibaba is taking control of Tianhong Asset Management to accelerate its push into online financial services. Tianhong shareholder Inner Mongolia Junzheng Energy & Chemical Industry said the investment of CNY1.18 billion gives Zhejiang Alibaba E-Commerce, the parent company of online payment company Alipay, 51% of Tianhong. Alipay and Tianhong launched a new fund and payment platform – Yu E Bao – in June to help Alipay customers convert spare cash into a money market fund holding. In its first 18 days, the fund attracted more than 2.5 million customers and raised CNY6.6 billion, according to Tianhong, and is expected to be one of the most successful mutual funds in the country this year. Alibaba, which is expected to file for an initial public offering (IPO) in New York next year that could value the company at more than USD100 billion, has been leading the drive by domestic internet companies into highly regulated financial services. “Tianhong and Alibaba are mutually complementary,” said Ding Xuemei, Spokeswoman for Tianhong. “Alibaba is very experienced in the internet and we are very experienced in investment management. We partner up for a better prospect in internet finance.” Alibaba bought its Tianhong stake through a fund-raising exercise that saw Tianhong’s registered capital more than double to CNY514.3 million from CNY180 million. Alipay is China’s biggest third-party payment platform, providing payment solutions to 460,000 merchants and with 800 million registered accounts. Customers can invest as little as CNY1 in the Yu E Bao service and can withdraw their money and return it to their Alipay accounts at any time, the South China Morning Post reports.
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