Chinese e-commerce giant Alibaba has agreed to acquire Hong Kong’s South China Morning Post (SCMP). The newspaper said on Monday.
The Hong Kong-based newspaper and SCMP Group’s other assets, which includes local editions of Esquire and Elle, will cost Alibaba a little over $266 million.
The newspaper said in a statement to the Hong Kong stock exchange: “Alibaba has agreed to purchase the media business of the (SCMP) Group for a cash consideration of HK$2,060,600,000 ($266 million).”
The media Company also cited an “uncertain” future for traditional publishing as a key reason behind the sale, adding Alibaba would likely be able to “unlock greater value” from the business.
SCMP Group said it expected to record a gain of around HK$1.4 billion from the asset sale. It plans to use the proceeds for the payment of a special cash dividend.
Some have expressed fears that SCMP may see compromising changes under Alibaba, prompting Alibaba’s Executive Vice Chairman Joe Tsai to dismiss such views adding that the company’s purchase of SCMP was “fueled by a desire to improve China’s image.
In an open letter to address the criticism, Tsai wrote: “This criticism reflects a bias of its own, as if to say newspaper owners must espouse certain views, while those that hold opposing views are ‘unfit.
In fact, that is exactly why we think the world needs a plurality of views when it comes to China coverage. China’s rise as an economic power and its importance to world stability is too important for there to be a singular thesis.
“In reporting the news, the SCMP will be objective, accurate and fair. This means having the courage to go against conventional wisdom, and taking care to verify stories, check sources and seek all viewpoints.
“These day-to-day editorial decisions will be driven by editors in the newsroom, not in the corporate boardroom.”
Alibaba, launched in 1999 and under the leadership of Jack Ma has become China’s biggest e-commerce company, operating consumer-to-consumer platform. In June, the company agreed to pay $194 million for an undisclosed stake in domestic financial media firm China Business News.