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Alibaba Group Buys 59.45% Stake In AGTech

China’s biggest online retailer Alibaba Group Holding Ltd. announced yesterday that it will buy a majority share in lottery provider AGTech Holdings Ltd. through its affiliate.  Alibaba’s main financial affiliate Ali Fortune Investment Holding Ltd. which is 60% owned by Alibaba and 40% by Alibaba’s financial services group Alipay, has agreed to the purchase of majority shares in AGTech for an amount of $308 million.

The Weight Alibaba Group will now Carry

According to the agreement, Alibaba will then own 59.45% stake in AGTech. As stated in an official statement, Sun Ho will remain as CEO, Chairman of the Board and an Executive Director of AGTech.   AGTech which is a leading integrated gaming company in China’s lottery market, suspended its lottery operations following the introduction of stringent lottery regulations Mainland China in February 2015. Upon the completion of its deal with Alibaba, AGTech will become the exclusive Chinese lottery platform of Alibaba.

The deal will give AGTech a chance to further grow its presence in online games and offering in China. AGTech has been engaging in online games, hardware, mobile lotteries, gaming technologies and lottery management for years across China. Following the completion, Ali Fortune and Alibaba will help the lottery giants with cloud computing among other things.

Nigel Frith

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