Exclusive: Alibaba Hema Xiansheng slashes funding at $6 billion valuation


 Alibaba’s supermarket chain Hema is trying to raise funds worth about $6 billion. That is well below the as much as $100 it hoped to raise earlier this year. They said the company had to lower its valuation expectations after China's COVID-19 restrictions.


Investors are skeptical that loss-making Hema can continue to grow and turn a profit soon. The supermarket chain is aiming to raise between $40 billion and $500 million from outside investors. The fundraiser is far from complete and financial terms could change, two people familiar with the matter warned.


The fourth source said Hema would welcome good investors to help it grow, but added that it had healthy cash flow and was not under immediate pressure to raise new capital. Hema has tempered its ambitions for its first-ever independent private funding round at a time when global investor interest in unprofitable tech companies has waned.


Hema was founded in 2015 and is 100% owned by e-commerce giant Alibaba. According to its website, Hema has more than 300 stores in 27 cities offering grocery delivery. Shanghai is the largest market with 73 stores. While Shanghai residents have relied heavily on delivery services during this year's two-month lockdown, grocers have struggled to meet demand.


Comments

Post a Comment

Popular posts from this blog

Singapore's crypto ambitions dashed by three arrows

Image
 Crypto players in Southeast Asia’s financial hub are bracing for more bankruptcies and lawsuits. Regulators expected to become less lenient at the Monetary Authority of Singapore (MAS), whose welcoming attitude has helped attract companies from China, India and elsewhere. The collapse of crypto fund Three Arrows Capital, a global digital currency slump, was a high profile victim. Investment in Singapore-based crypto and blockchain companies will grow to $1.48 billion in 2021, a 10-fold increase from the previous year. It will account for almost half of the total investment in the Asia-Pacific region in 2021. MAS regulators say they want to promote crypto-related services. Three Arrows Capital (3AC) began liquidation proceedings in the British Virgin Islands on June 27. 3AC did not respond to a request for comment, and its liquidators told a U.S. bankruptcy court they were unable to locate the fund’s founders, Kyle Davis and Zhu Su. The fallout from 3AC's collapse -- and the market
Read more

Computer chips face toilet paper hoarding as shortage turns into glut

Image
 Micron's solid-state drives for data center customers were unveiled at a product launch event in San Francisco, U.S., October 24, 2019. High inflation, the recent COVID lockdown in China and the war in Ukraine dampened consumer spending, especially on PCs and smartphones. Memory chip company Micron Technology announced it would cut production. Micron’s chief commercial officer, Sumit Sadana, acknowledged that the market reversal took Micron by surprise. TechInsights chip economist Dan Hutcheson warned of more bad news after Micron's bleak outlook. Fears of an industry downturn have taken a toll on chip stocks, with the Philadelphia Semiconductor Index (.SOX) plummeting 35% so far in 2022. (See https://tmsnrt.rs/3arSbBA).. Hoarding can make it worse. Just as nervous shoppers searched supermarket aisles for toilet paper before the COVID-19 lockdown, manufacturers have been stockpiling computer chips. Experts say the big-chip reversal hits economic sectors unevenly. Big chip supp
Read more

UK regulators probe Microsoft's $68.7 billion deal with Activision

Image
 U.K. antitrust regulators said on Wednesday they were opening up a bid by Microsoft to buy Call of Duty maker Activision Blizzard. Britain's Competition and Markets Authority said it had until September 1 to make a first-stage decision on whether a deal between the US tech firm and video game maker Activision would reduce competition in the UK. Lisa Tanzi, Microsoft's corporate vice president and general counsel, said in an interview with Reuters: \\'We are committed to answering the questions raised by regulators and ultimately believe that a thorough scrutiny will help close the deal with broad confidence and have an impact on competition' Activision did not immediately respond to a request for comment. UK regulators are investigating Microsoft’s $68.7 billion deal with Activision. In January, Microsoft announced it would acquire Activision Blizzard, the largest deal in the history of the gaming industry. The CMA's Phase 1 investigation will lead to either approv
Read more