Magnates team up to take on Alibaba

Wang Jianlin (C), Chairman of Wanda, holds hands with Tencent Chief Executive Officer Pony Ma (R) and Baidu Inc. Chairman and CEO Robin Li (L), in Shenzhen, Guangdong province, August 29, 2014. China's Dalian Wanda group and Tencent Holdings Ltd said on Friday they would set up a 5 billion yuan ($814 million) e-commerce joint venture with Baidu Inc, as the firms push into the high-growth e-commerce sector.[Photo/Provided to China Daily]

It's "game on" for the top four richest men on the Chinese mainland.

Real estate guru Wang Jianlin, the wealthiest person in the country last year, announced on Friday a 5 billion yuan ($813 million) joint investment in e-commerce with Internet magnates Ma Huateng and Robin Li, the second and third richest.

They are targeting online shopping giant Alibaba Group Holding founder and chairman Jack Ma, who climbed to the top of the rich list on Thursday with a net worth of $21.8 billion, according to the Bloomberg Billionaires Index.

Wang, chairman of developer Dalian Wanda Group, said: "Selling products only accounts for a small part of the multi-trillion-yuan e-commerce market in China. We are trying to introduce a seamless online and offline shopping experience to customers."

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Under a three-party agreement, Wanda will control 70 percent of the shares in the new joint venture, while Ma Huateng's Tencent Holdings and Li's Baidu will split the remaining 30 percent.

Vanessa Zeng, a senior analyst at Forrester Research, said the aim is to develop an online-to-offline transformation based on nationwide brick-and-mortar commercial properties known as Wanda Plaza.

"Wanda's core resource for doing e-commerce is its VIP customers and customer data," Zeng said. "Wanda can leverage Tencent's social network resource and payment capability and Baidu's search and big-data capabilities."

Baidu and Tencent are developing location-based services, online navigation and Web-based instant messaging tools, all of which are necessary features for Wang's ambitious plan.

Tencent is working on a heavily invested project to bring global online application developers under its wing.

Analysts believe the joint venture will integrate the three parties' resources, making them stand out in marketing, supply chain, consumer finance and buying-behavior analysis.

The Chinese online shopping market has been Alibaba's home turf for more than a decade. Taobao.com, the company's customer-to-customer arm, handles almost all the transactions in the sector.

Alibaba is in the final stages of a landmark initial public offering on the New York Stock Exchange, with the IPO value estimated at $150 billion.

The accumulated personal wealth of Wang, Li and Ma Huateng is $47 billion, according to the Bloomberg index, similar to the 2013 GDP of Tunisia.

It is still too early to call the winner or winners in this clash of the billionaires.

gaoyuan@chinadaily.com.cn