China's biggest property developer Wanda Group said it will set up an e-commerce venture at a cost of over $800 million with two other Internet giants, Baidu and Tencent, in a challenge to industry leader Alibaba Group ahead of its debut in the US stock market.
The three companies will initially invest 5 billion yuan ($ 814 million) and the investment will reach 20 billion yuan within five years, Wanda chairman Wang Jianlin said during the contract signing ceremony. Wanda will hold 70 per cent stake in the joint venture, the name of which is still unknown. Baidu and Tencent will hold 15 per cent each, state-run Xinhua news agency reported.
The e-commerce company will be registered in Hong Kong. After a test run this year, its online services will be formally launched next year. Alibaba, the country's largest e-commerce company, is poised to launch what is potentially the world's largest-ever technology IPO in the United States. Analysts say the initial public offering might value Alibaba between $150 billion and $200 billion. Alibaba founder Jack Ma, whose assets were valued at $ 21.8 billion, is regarded as China's richest man.