<div id="readability-page-1"><div><p>[HONG KONG] Alibaba Group Holding is offering US$1.5 billion to acquire Chinese grocery delivery firm Pupu, initiating a bidding war as part of a broader campaign to wrest market share from Meituan in online commerce.</p><p>China’s largest consumer Internet platform’s proposed price is more than double an earlier bid from Sun Art Retail, according to people familiar with the matter. Sun Art, a former Alibaba affiliate that is now backed by private equity firm DCP Capital, had proposed a takeover at US$600 million, the people said, asking not to be identified because the sale process is confidential.</p><p>Alibaba’s proposal emerged just months after Meituan announced a US$717 million acquisition of Dingdong Fresh Holding, after beating out rival bidders.</p><p>Alibaba’s aggressive offer underscores its determination to prevail in an intensifying battle between three giants of Chinese online commerce. The rising valuations reflect fierce competition for scarce retail assets, as Alibaba, Meituan and JD.com step up efforts to dominate local commerce and fresh produce, among the few remaining consumer segments that remain under-penetrated online.</p><p>Fujian-based Pupu is among the last independant online grocery companies in China yet to be acquired. China’s grocery platforms have engaged in years of subsidy-driven price wars, pressuring margins and perpetuating “involution” – the destructive competition Beijing is now seeking to reduce.</p><p>While consolidation may help curb price wars, it also risks concentrating market power in the hands of a few dominant platforms, potentially conflicting with Beijing’s goal of fostering more competition. Meituan’s proposed acquisition of Dingdong is awaiting approval from antitrust regulators. A Pupu sale to an industry leader may also draw Beijing’s attention.</p><p>A representative for Alibaba did not reply to a request for comment. DCP declined to comment and a Pupu representative declined to comment.</p><h2>Squeeze on rivals</h2><p>Major Internet companies have historically relied on cash-burning strategies to acquire customers, subsidising products and services, squeezing rivals and forcing many smaller competitors out of the market. Once they disappear, dominant platforms gain greater leverage over merchants, suppliers and consumers.</p><p>Chinese e-commerce giants’ price war has been weighing on stocks. Shares of Alibaba, JD.com dropped in Hong Kong after China’s market watchdog reprimanded the firms for what it said were misleading sales promotions.</p><p>Pupu is one of China’s leading instant grocery retail platforms, generating annual revenue of more than 30 billion yuan. The company operates primarily through a 30-minute delivery network covering around 10 cities across four provinces: Fujian, Guangdong, Sichuan and Hubei. BLOOMBERG</p></div></div>

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<p>Alibaba is offering $1.5 billion to acquire Chinese grocery delivery firm Pupu, initiating a bidding war against Meituan and Sun Art Retail. This move aims to gain market share in online commerce, following Meituan's recent acquisition of Dingdong Fresh. The aggressive bid highlights intense competition among tech giants for under-penetrated retail segments, though consolidation risks antitrust scrutiny from Beijing.</p>

- Alibaba Group Holding is proposing a US$1.5 billion bid to acquire Pupu, a Chinese grocery delivery firm, intensifying competition against Meituan.  
- This offer surpasses an earlier US$600 million bid by Sun Art Retail, reflecting rising valuations in the highly competitive online commerce sector.  
- The consolidation in the grocery market may reduce destructive price wars, but risks increasing market concentration, potentially conflicting with Beijing’s regulatory goals.

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Alibaba bids US$1.5 billion for China grocer in fight with Meituan