April 2, 2018AliBaba Group and Ant Financial announced a joint acquisition of Ele.me for $9.5 billion. This deal makes Ele.me becomeAliAn important part of the local service business. After more than 5 years, Ele.me has been withAliIts other businesses have been deeply integrated and have played a huge roleSynergies
From the rumors, it is known that about Douyin andAliRumors of negotiating the acquisition of Ele.me have not been confirmed by Douyin. Ele.me also said that the two sides have been cooperating, and the so-called "acquisition" rumors are completely nonsense. As the second largest food delivery platform in China, Ele.me not only has a huge terminal delivery population, but also carriesAliThe heart of the local lifestyle sector. Together with AutoNavi Map, Fliggy and other businesses, it has been formedAliA comprehensive layout in the field of local living.
fromAliAs can be seen in the financial report,Local Life ServicesRevenue in the third quarter reached 155.6 billion yuan, up 16% year-on-year. With the increase in the order volume and unit price of Ele.me, the development momentum continues to improve. So, at this time,AliSelling Ele.me to Douyin is obviously an unreasonable choice.
AliThe primary purpose of acquiring Ele.me is to make up for its gainsNew retailThe shortcomings of local retail have been linked with its businesses such as Koubei, Fliggy, and AutoNavi Map to lay out the last mile of the local market. Compared to competitors such as Meituan,AliThere is still a big gap in terms of the core income of local business, and the market size has reached the trillion level, thereforeAliWe will not give up this market easily.
fromInvestmentsFrom the perspective of returns, according to the rumored ** 7 billion US dollars, it is equivalent toAliLost $2.5 billion in five years, an average annual loss of about $500 millionRMBAbout more than 3 billion yuan. However, this does not include Ele.me's long-standing losses. From this perspective, Ele.me's valuation seems to be on the low side.
ForAliIn addition, the acquisition of Ele.me is to make a more comprehensive layout in the local service field and make up for its own existenceNew retailDeficiencies in local retail. With the increase in the order volume and unit price of Ele.me,AliInLocal Life ServicesRevenue in the field is also growing, showing the positive effects of this acquisition.
However, in the highly competitive food delivery market,AliMany challenges remain. Compared to competitors such as Meituan,AliThe gap in the core income of local businesses is still large, and further investment and efforts are needed. At the same time, the outside world is forAliThe rumors of selling Ele.me to Douyin are somewhat controversial, as the move does not seem to be in line with thisAliCurrent strategic planning.
In summary,AliThe acquisition of Ele.me is to strengthenLocal Life ServicesThe layout of the field to enhance its own inNew retailStrength in local retail. withAliWith the deep integration and cooperation with Ele.me, Ele.me will continue to becomeAliThe core components of the local service, and for:AliBring more benefits and development opportunities. However,AliIt also needs to face the competition in the food delivery market and increase investment and efforts to further enhance its market position in the field of local life.