SHANGHAI (Reuters) - Chinese e-commerce giant Alibaba Group Holding Ltd will invest 2 billion yuan ($288.25 million) in domestic wine and spirits importer and retailer 1919.cn to tap into resurgent demand for imported wine in China.
The wine and spirits platform, listed on China’s over-the-counter equities exchange, said in a statement to the National Equities Exchange And Quotations (NEEQ) on Thursday that Alibaba would buy over 39.3 million shares in a share subscription.
China is expected to become the world’s second largest wine market behind the United States in the next five years, with consumption set to rise over a third to hit $23 billion, according to wine fair operator Vinexpo.
The wine and spirit importer said in the filing that its revenues climbed 16.24 percent last year to 3.36 billion yuan and it expected to clock sales of around 4.5 billion yuan this year and 7 billion yuan in 2019.
Beside importing, 1919.cn sells wine, beers and spirits directly to Chinese consumers on its site, with goods imported from major wine producers France, Australia, Spain, Chile, Italy and the United States as well as domestically produced tipples.
Alibaba did not immediately respond to a request for comment.
($1 = 6.9384 Chinese yuan renminbi)
Reporting by Adam Jourdan; Editing by Vyas Mohan