Alibaba Group signs first larger deal after paying antitrust fine

Alibaba Group Holding Ltd (NYSE: BABA) will sign its first major deal after paying the record-breaking antitrust fine for getting rid of Jack Ma's internet territory. The e-commerce emperor and the Jiangsu government will sign a deal planning to buy shares in the retail arm of Suning Conglomerate, owned by Zhang Jingdong, one of the billionaires in China. This deal will add 20% to Alibaba's existing stake in the Suning Group and cost approximately $ 8 billion. This may be a big comeback for the company after officials fined the company $ 2.8 billion in April for antimonopoly violations. This resulted in the Alibaba groups' first loss in nine years. This new deal with the local government will help the largest retailer overwhelm rival electronics stronghold JD.com. Every time a new deal is made, the state administration has to allow it due to market regulations. However, these regulators only fined Alibaba heavily for failing to properly inform about past investments with Intime Group. So the new big deal that Alibaba is hoping we can expect an announcement later this week, say folks who don't want to be named. And there's still a chance that deal could be delayed or canceled. Suning owner Zhang will no longer have control of the company when the deal goes through. It is said that it will be the end of his era, an entrepreneur who runs huge companies, including Inter Milan football club. This feeds concerns about the Suning Group's liquidity. Suning has an immense retail presence across China, especially in the eastern parts of Shanghai. In hypermarkets, they have a share of 4.4%, which according to Euromonitor international will be the fifth largest share nationwide in 2020. In first place is of course Alibaba with a share of 13.7%. Alibaba and the Suning Group have long been allies. They worked together in many areas, from logistics to online sales. In 2015, Alibaba bought a 20% stake in Suning for $ 4.6 billion; in return, they paid $ 2.3 million to buy a 1.1% stake in a large company that didn't work. Since then, Suning has collapsed with a 60% stake and Alibaba has doubled.