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Alibaba to Purchase Hong Kong's South China Morning Post Newspaper

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On Friday, Chinese e-commerce giant Alibaba BABA has agreed to purchase Hong Kong's South China Morning Post (SCMP) as well as other partnering media assets. Financial terms were not disclosed. In a statement, Alibaba said that the deal would include, in addition to the leading publication, SCMP's magazine and recruitment newspapers.

Alibaba hopes the purchase of SCMP will help boost its budding media empire. The company has made decisions over the past few months that point towards this direction. Alibaba helped set up media company CMC Holdings after buying a sizable portion in one of China's most prominent business media companies back in June. And most recently in November, the online retailer agreed to purchase video platform Youku Tudou Inc, the Chinese version of Google's GOOGL YouTube; Alibaba expects this move to increase its video streaming numbers to Internet users in China. Alibaba also invested in Paramount Pictures' VIA most recent installment in the Mission Impossible franchise through its film group unit.

Alibaba's billionaire CEO Jack Ma is making similar moves to American e-commerce giant Amazon's CEO Jeff Bezos, whom bought the Washington Post in 2013. This decision to obtain struggling print news publications seems to be popular among Internet leaders. One of the o-founders of Facebook FB Chris Hughes acquired a majority holding in the magazine New Republic , and when the Financial Times was up for bidding earlier this year, Mathias Doepfner of German media company Axel Springer SE offered money to buy the publication; it eventually was sold to Nikkei Inc of Japan for $1.3 billion.

With this sale, SCMP will get an owner that will invest more than 100 billion yuan, or $15.5 billion. The newspaper's listed parent company SCMP Group has been struggling in recent years, seeing profit declines amidst the rise of free online publications. Its magazine division is allowed to publish the Chinese versions of popular American magazines Cosmopolitan and Harper's Bazaar. SCMP's current owner is Malaysian sugar magnate Robert Kuok, who acquired the newspaper from media tycoon Rupert Murdoch in 1993.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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