Alibaba to lead $1bn investment in Ele.me

Alibaba plans to lead an investment round of at least $1 billion in Ele.me, Bloomberg reports. The financing from Alibaba and Ant Financial will value Ele.me at $5.5 billion to $6 billion and help it compete with a rival service backed by Tencent, sources said, requesting not to be named because the matter is private. Once completed, the deal would mark the country’s second-largest startup fundraising effort so far in 2017, surpassed only by ride-sharing giant Didi Chuxing’s $5.5 billion round. Alibaba is vying for supremacy with the Tencent-backed startup, Meituan Dianping, in a local services industry primed for growth as people turn to their smartphones or the web to order food, schedule beauty treatments and hire domestic helpers. Sales of such services are expected to reach 7.28 trillion yuan ($1.1 trillion) this year. Startup investments surged 40% to $6 billion in the first quarter, CB Insights estimates.