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Alibaba, China Post in logistics tie-up

2014-06-13 07:57 Xinhua Web Editor: Qin Dexing

Alibaba Group signed a deal with China's largest postal service provider on Thursday in a latest move to strengthen its logistics arm before the e-commerce titan is listed in the United States.

Alibaba founder and chairman Jack Ma and China Post's general manager Li Guohua inked a framework deal in Beijing with the ambition of delivering online purchases to any place in the country within 24 hours.

The two companies will share warehouses, processing centers and delivery resources, aiming to build a smart logistics network providing easier and faster delivery services to online sellers.

In possession of e-commerce big data and Internet technology, Alibaba hopes to extend its reach to third and fourth-tier cities and even the countryside with the help of China Post's offices in rural areas.

The two parties are yet to reveal details of the deal.

As parent company of China's largest consumer-to-consumer portal Taobao.com, Alibaba has great need for delivering online purchases. Ma founded the Rookie Network Technology Co., Ltd last May to start Alibaba's own logistics services.

Rookie has attracted investment from major delivery companies including Shentong Express, ZTO Express and YTO Express.

As Alibaba is set to sell shares in the U.S. equity market, the company is actively expanding its business outside China to boost its international profile.

Last month, Alibaba spent 249 million U.S. dollars on a 10.35 percent stake in Singapore Post Ltd., a leading provider of e-commerce logistics services in southeast Asia.

Thursday's deal also illustrated Ma's global ambition as Alibaba is considering international deliveries through China Post's global logistics network.

For China Post, the deal is expected to revitalize its delivery business. Although it has more than 100,000 offices across the nation and dominates in deliveries of post like confidential files, the company is challenged by rapidly expanding private express firms with cheaper and faster services.

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