Cainiao Network, the logistics arm of Chinese e-commerce giant Alibaba Group Holding Ltd, will hold another round of fund-raising but it is hoping that money raised in March will be sufficient for a year to 18 months.
In its first round of funding this year, Cainiao attracted investors such as Singapore’s Temasek Holdings and GIC Pte Ltd, Malaysia’s Khazanah Nasional Bhd, and China’s Primavera Capital.Business news magazine Caixin reported that the value of the round was close to 50 billion yuan ($7.5 billion).
Chief Executive Judy Tong said during a news conference:
“In the future we will definitely raise money again. Cainiao is a very young company. It requires a lot of investment.”
Alibaba, which owns about 47 percent of Cainiao, wants to take a leading role in developing China’s fragmented package delivery industry, as e-commerce spreads beyond urban hubs and requires a more robust logistics network. Cainiao manages a network of warehouses and crunches data to coordinate courier deliveries around China.
Tong also said the company had not come under further pressure from the U.S. Securities and Exchange Commission (SEC), which is probing Alibaba’s accounting, part of which is focused on its accounting for Cainiao. Alibaba has said it is cooperating with the investigation and has handed information to the SEC.