Alibaba Health Information Technology plans to pump the $1.3 billion it raised in a secondary offering on the Hong Kong stock exchange to expand its eCommerce pharmaceutical business as it rides a wave of growth amid the coronavirus.
Alibaba Health, a subsidiary of Chinese online retail giant Alibaba, said it plans to spend 80 percent to 90 percent of the net proceeds on “expanding the Group’s pharmaceutical and medical services network,” as well as “enriching member services and user-focused content.”
In particular, Alibaba Health said it is developing plans to utilize “internet technologies” in order “to build an omnichannel for pharmaceutical and healthcare products and service supply and a service system.”
The remaining 10 percent to 20 percent of the money raised by the offering, reportedly the largest follow-on sale of shares in Hong Kong in five years, will be used to “further develop” its digital infrastructure, Alibaba said.
That includes “expanding the range of internet and technological solutions provided to healthcare industry participants,” the company said in stock-offering documents.
Alibaba Health said it is also exploring the development of more “convenient internet healthcare service scenarios” and leveraging the power of the Internet of Things to help transform the way medical services are delivered.
The move comes roughly six months after Alibaba launched a sales platform for medical supplies needed to fight the coronavirus. The business-to-business platform matches medical suppliers and products with hospitals and public health authorities.
Alibaba noted that the Chinese government’s promotion of online healthcare in the wake of the pandemic has been a major driver of growth.
“Online healthcare consultation services have had a significant positive social impact during the COVID-19 pandemic,” Alibaba noted in its stock offering documents. “Following the recent introduction of a series of policies promoting internet healthcare by the PRC government, the industry has entered into a new track of accelerated development.”
Selected by Fintech Tube