HONG KONG: Alibaba Investing in SCMP Group?

MIRANDA PAK WRITES – China’s biggest e-commerce company, Alibaba is rumored to be in talks about investing in SCMP Group Ltd, which publishes Hong Kong’s leading English newspaper the South China Morning Post.

According to China Daily, Alibaba is trying to expand into the media and entertainment industries. More specifically, the e-commerce entity is “in talks to take a stake in Sina Corp, which runs online news portal sina.com.cn and Weibo, the Chinese equivalent of Twitter.” Since Alibaba is trying to break into the media industry, then it would make sense for Alibaba to take interest in SCMP, the most prominent of all Hong Kong media brands internationally. There are also many other reasons why many people believe that Alibaba is wanting to invest in SCMP.

Over the last two years, Alibaba has spent a lot of acquisition money, and media and entertainment has been the major focus. For its parts, SCMP’s owner has apparently been looking to sell for a while because people are starting to become less interested in print media. By contrast, as Alibaba focuses more on media and entertainment, It has also been interested and investing in traditional news media. Value Walk has reported that, earlier this year in June, “Alibaba formed a financial news joint venture with China Business Network (CBN), China’s leading financial newspaper”.

It would be a smart and logical choice for Alibaba to branch out into different industries. If it were to invest in SCMP, would the articles that SCMP be any different than the ones they have now? Would the Hong Kong people regard it as appropriate for Alibaba, a mainland China company, to have a stake in their leading English newspaper publisher?

At the same time, if Alibaba did invest in SCMP, might not all its media connections help SCMP emerge even stronger?

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