NASDAQ-listed NetEase Inc. on Friday reached an agreement with Alibaba Group Holding Ltd. on the latter's acquisition of Netease's cross-border e-commerce platform Kaola.
According to the deal, Alibaba agreed to extend 2 billion U.S. dollars for the acquisition of Kaola, and participate in financing of 700 million dollars for Netease's Cloud Music.
Both of the U.S.-listed Chinese internet giants are rooted in Hangzhou, capital of east China's Zhejiang Province. The two companies said the integration helps them work more closely together to explore the future of the digital economy era.
Daniel Zhang, chief executive officer of Alibaba, said Alibaba plans for Kaola to continue to operate independently under its current brand. Alibaba's General Manager of Tmall Import & Export Alvin Liu will serve as Kaola's new CEO.
"With Kaola, we will further elevate import service and experience for Chinese consumers through synergies across the Alibaba ecosystem," said Zhang.
William Ding, chief executive officer of NetEase, said NetEase expects Koala to continue to provide quality cross-border e-commerce services to its users within the Alibaba ecosystem.
Zhang said Alibaba also looks forward to becoming a partner in the future development of NetEase Cloud Music and exploring innovative collaboration in the digital entertainment space.
NetEase will remain the controlling shareholder of NetEase Cloud Music following the closing of Alibaba's financing.