Alibaba in Talks With Banks for up to $4 Billion Loan

by Jonathan Adams

Chinese Internet giant Alibaba Group Holding Ltd. is in discussions with banks for a loan of up to $4 billion to fund expansion plans, including acquisitions, according to people familiar with the matter.

Alibaba’s plans to add to its war chest come after it spent billions of dollars on investments and acquisitions over the past year, both in China and overseas markets such as India.

The discussions, involving several banks, started with plans for a $3 billion loan, but the amount could be increased to $4 billion, the people said. One of the people said that the loan is expected to be finalized next month.

China’s biggest online shopping company has been ramping up its investments in a wide range of businesses, from mobile apps and logistics partners in China to online payments in India.

In June, Alibaba and its financial-services affiliate said they would together invest nearly $1 billion in Koubei, a food-ordering app, to turn it into a broader service that connects online users with brick-and-mortar businesses like restaurants. Two months later, Alibaba announced it would spend about $4.5 billion for a nearly 20% stake in Chinese electronics retailer Suning Commerce Group Ltd., as part of its efforts to beef up its logistics by teaming up with a major bricks-and-mortar retail chain. In November, Alibaba said it would turn Youku Tudou Inc. into a wholly-owned unit in a deal that valued the online video provider at about $4.4 billion.

In India, Alibaba invested in online shopping startup and One97 Communications Ltd., which runs a dominant local online-payment service called Paytm.

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