Alibaba and Bytedance Talks on Future of Ele.me Food Delivery Service Continue

Alibaba and Bytedance Talks on Future of Ele.me Food Delivery Service Continue
Photo: SCMP 15.01.2024 685

The talks were reported by Chinese financial media outlet Caijing, while Ele.me denies rumors of a possible purchase of the service by Alibaba.

ByteDance and Alibaba have not yet reached a consensus on the terms or price of an offer by the former to buy Alibaba’s food delivery service Ele.me according to financial media outlet Caijing. 

However, Alibaba yet again denied it was in negotiations with ByteDance to sell ELe.me. Ele.me itself also denies the talks, Yicai Global reported.

Bytedance, operator of TikTok and its domestic sibling Douyin, was reported by Caijing to have bid $7 billion, which is $500 million to $1 billion less than expected by Alibaba. In addition, ByteDance is trying to assume only Ele.me's instant delivery business, but Alibaba expects it to take over the whole platform, according to Caijing.

A separate market rumor on Dec. 19 stated that ByteDance's short-video platform Douyin, the Chinese version of TikTok, was also talking with Hangzhou-based Alibaba about buying Ele.me.

Ele.me and Douyin joined hands last August, with Ele.me helping merchants to provide instant delivery and other local life services to users on interactive platform open.douyin.Com via a mini program.

Douyin has no plans to buy Ele.me, said the head of a related business at the former. The partnership between Ele.me and Douyin is advancing steadily, but an acquisition is completely unfounded, an insider from Ele.me added.

Alibaba took full control of Ele.me in 2018 at a valuation of $9.5 billion, as it took steps into the local services industry to compete with Meituan. The business has yet to enter a clear cycle of profitability. 

As Douyin relies on third-party platforms including SF Express, JD’s Dada, and Ele.me to fulfill its delivery demands, building its own team of riders is crucial for ByteDance in doubling down on its local service ambitions.

Sources: Yicai Global, TechNode

digital markets  China 

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