Sina announced today that it has reached an agreement on a strategic alliance with Alibaba. The company grabbed 18% of Sina’s Weibo stake with a $586 million investment. Sina even allowed Weibo to increase its stake to 30% in the company on a fully-diluted basis at a mutually agreed valuation within a certain period of time in the future.
The two companies now cooperate in the areas of user account connectivity, data exchange, online payment and online marketing as well as together will explore new business models for social commerce based on the interactions of the hundreds of millions of users on both Weibo and Alibaba’s e-commerce platforms.
“We believe that this strategic alliance helps to create a stronger Weibo. It affirms our view of the vitality and importance of social media in unleashing value in e-commerce activities. We believe that the cooperation of our two robust platforms will bring unique and valuable services to Weibo users, as well as making the mobile Internet a core part of Alibaba’s strategy,” said Jack Ma , Chairman of Alibaba.