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Alibaba added health unit assets in $1.4 billion deal

Alibaba Health Information Technology Ltd. will buy Ali JK Nutritional Products Holdings Limited which controls the sale of medical equipment, health care products, adult products and health services on the Tmall Alibaba platform. Alibaba Group Holding Ltd business unit said in a statement on Tuesday that it has set up pharmaceutical assets in an agreement of US$1.4 billion.

China's e-commerce giant Alibaba Group Holding Ltd will inject several online pharmaceutical businesses into units listed in a deal worth HK$10.6 billion. The deal will encourage Alibaba to get a new stake in Ali Health for 56.2 percent of the current 48.1 percent share and has 67.5 percent of the voting rights in Ali Health.

Tinuku Alibaba added health unit assets in $1.4 billion deal

The latest step is the efforts of Ali Health to win the emerging market competition of health care technology by other companies in China including WeDoctor supported by Tencent Holdings and Ping An Healthcare. Alibaba CEO Daniel Zhang said healthcare is an "important" business area and that the deal will help turn Ali Health into the "best healthcare ecosystem" in the country.

McKinsey & Co reported healthcare spending in China will reach US$1 trillion by 2020, up from US$357 billion in 2011. Technology companies are increasingly entering the growing private healthcare market. Ali Health generated a gross volume of about 20.56 billion yuan (US$3.21 billion) in financial year to March 31 and has more than 3,300 merchants.

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