Alibaba plans to inject Tmall Blue Hat Health Food Business into Alibaba Health

　　On May 19, Alibaba Health issued an announcement announcing that it had officially signed a share subscription agreement with Alibaba Group, and Alibaba Group injected Alibaba Health's online business worth HK$3.8 billion worth of Tmall pharmaceutical platform "Blue Hat" health food online business into Alibaba Health.

　　According to the equity subscription agreement disclosed in the announcement, after the transaction is completed, Alibaba Group's shareholding in Alibaba Health will increase from approximately 37.9% to approximately 45.8%, and the voting rights will increase from approximately 54.0% to approximately 59.8%.

　　Health foods registered or registered by the State Food and Drug Administration will obtain a health food logo with a registration number or registration number. The special logo is sky blue and in the shape of a hat, commonly known as "blue hat" in the industry. This time Alibaba is going to inject Alibaba's healthcare food business, which is the "Blue Hat" healthcare food business on the Tmall platform.

　　The announcement shows that in the fiscal year ended March 31, 2017, more than 950 merchants sold blue hat health foods on Tmall Pharmaceutical platform, with more than 11.81 million active buyers in the year, and the transaction volume of the blue hat health food business was approximately RMB 2.772 billion. After the transaction is completed, Alibaba Health will obtain the business contract relationship between the "Blue Hat" health food merchant on the Tmall Pharmaceutical platform, provide it with a series of value-added services including settlement, brand marketing, technical support, etc., and collect commissions.

　　The announcement shows that "the Company believes that the acquisition of the target business will be able to: (a) further ensure that the Company develops into the flagship pharmaceutical and health care platform of Alibaba Group; (b) integrate a wider range of e-commerce merchants into the online medical and health care community to enrich the ecosystem, and form organic complementarity with the company's three major business segments: the company's pharmaceutical e-commerce business, smart medical services, and product traceability platform services; and (c) obtain more stable and sustainable revenue growth."

　　As early as April 2016, Alibaba Health issued an announcement stating that it is actively discussing with Alibaba Group to inject Alibaba Group's health foods, dietary nutritional supplementary foods and traditional tonic nutritional products business into Alibaba Group.

　　On March 14 this year, Alibaba Health issued another announcement announcing that it will continue to actively seek to acquire Tmall Health Food online business. The signing of this share subscription agreement is a specific result that has been discussed in more than a year.

　　"Blue Hat" health food is originally a sales category with a considerable share of Tmall Pharmaceutical Platform, and there is still huge room for growth in the future. At the beginning of the year, the "2016 China Medical and Drug Investment Association Industry Development Blue Book" disclosed that the share of medical and health care products in pharmaceutical e-commerce consumption increased from 76.9% to 82.8% in 2016, and maintained stable growth in the past three years. Data released by the announcement shows that in fiscal 2017, the commission income brought to the Tmall platform by this business reached RMB 62.27 million. Once the injection is completed, it will add more revenue to Alibaba Health and Pharmaceutical e-commerce sector.

　　At present, Alibaba's e-commerce business segments include Alibaba Health Pharmacy, Tmall Pharmaceutical Agency Operation Services, and a complete system of pharmaceutical O2O. Among them, the Tmall Pharmaceutical Platform operates on behalf of the agent is Alibaba's core pharmaceutical and health care product retail platform, and it is also one of the fastest growing categories on Tmall.

　　According to the future layout displayed on Alibaba Health’s official website, Alibaba Health will use the Internet and big data technology to build an industry-wide ecosystem including medical services, medical e-commerce, personal health management and health insurance. The injection of "blue hat" assets has made Alibaba Health take another step towards the construction of the industry-wide ecosystem.

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