China’s Alibaba is reportedly negotiating a joint investment with the South Korean city of Incheon for a 1 trillion won (approximately US$923 million) new business complex.
If approved, the business complex will receive equal funding from both parties and will include a shopping mall, hotel and logistics centre. The reports of the business remain speculative as both parties have chosen not to comment yet. “Alibaba Group sees great potential in the South Korean market, however the media reports on the ‘Alibaba town’ investment are purely speculative,” said an Alibaba spokesperson.
Incheon is situated in the Northwestern region of South Korea and form’s part of Seoul National Capital Area, with the national capital Seoul situated to the East. The small city has a population of almost 2.9 million people, making it the third most populous city in the country. The city has lead South Korea’s economic development for the past two decades, and was named Korea’s first free economic zone in 2003. Since then, large global corporations such as Samsung have invested in the Incheon Free Economic Zone.
Incheon is also a coastal city and a great part of the city’s advancement can be attributed to this natural advantage which lead to the construction of a port. Icheon’s port is the second largest in South Korea after the one in the city of Busan, situated to the East. Incheon International Airport is a major transportation hub in northeast Asia, catering for over 400 daily flights and over 160,000 flights annually.
The Alibaba Group is headquartered in Hangzhou, China with offices in Hong Kong, Taiwan, the U.K. and the U.S. The Chinese e-commerce company was established in 1999 by Chinese businessman Jack Ma, whose net worth of over US$29 billion has made him the wealthiest man in China as a result of the company’s success. Alibaba’s IPO (initial public offering) in the U.S. in September of last year was the biggest IPO in U.S. history and was also the largest technology listing in the U.S. to date.
The company’s IPO took place on the 18th of September 2014 with shares selling at US$68 each on the NYSE (New York Stock Exchange), raising US$21.8 billion for the company. On the following day, Alibaba shares (BABA) opened at a trading price of US$92.70.