Alibaba and Cainiao invest $1.38bn for 10% stake in ZTO Express
Alibaba and its logistic arm Cainiao Network has invested $1.38bn in ZTO Express in return for approximately 10% of the Chinese express delivery company.
The investment will see Cainiao and ZTO deepen their collaboration in the transformation of China's logistics industry amid the growth of New Retail, a concept developed by Alibaba that promotes seamless integration between online and offline commerce.
It will also further support both Cainiao and ZTO's focus on building up first and last-mile pickup and delivery capabilities, warehouse management, cross-border logistics and technology-driven smart solutions.
Daniel Zhang, CEO of Alibaba Group and Chairman of Cainiao Network, said: “ZTO has been an important partner to Alibaba Group and Cainiao Network in the development of the new digital economy.
“The continuing expansion of New Retail is catalysing new opportunities and demands in logistics. This strategic investment will strengthen synergies across our mutual businesses to create new value and improved experience for merchants and consumers.”
Meisong Lai, Founder, Chairman and Chief Executive Officer of ZTO, said: “The growth of e-commerce and New Retail in China demands more efficient express delivery and expanded logistics services.
“To that effect, we are delighted to enhance our partnership with Alibaba and Cainiao through their strategic investments in ZTO.
“This partnership will enable us to expand our selection of high quality service offerings both in China and internationally and is fully aligned with our common interest in improving logistics efficiency and enhancing customer experience.”
Suez Canal expansion plans greenlit by Egyptian president
The Suez Canal is to undergo a two-year expansion project, following the weeklong closure of the channel by the stranded Ever Given container ship in March.
Plans set forth to expand narrow sections of the Suez Canal have been greenlit by the Egyptian president to safeguard against future blockages.
Dredgers will widen and deepen the single-lane stretch close to the southern mouth of the canal, near where the 400m container ship got wedged earlier this year, while a second lane opened in 2015 will be extended to promote two-way traffic and alleviate the impact of bottlenecks.
President Abdel Fattah al-Sisi gave the order to “immediately start implementing the proposed development plan and put in place a timetable for completion as soon as possible”, according to reports. It is understood he expects the work to be fully completed within two years.
Ever Given negotiations rage on
The Ever Given left hundreds of ships stranded and disrupted an estimated $9.5bn in goods each day when it became wedged across a narrow passage of the trade route in March. After a week of dredging, towing and manoeuvring, it was eventually freed from the banks of the Suez Canal in the early hours of 29 March and set course of the Bitter Lakes holding area.
There the vessel, its crew and its cargo have remained ever since, while legal action between Egyptian authorities and the ship’s owners rages on, though SCA chairman and Managing Director, Admiral Osama Rabie, refutes allegations that crew have been detained.
“[There] is no truth in the allegations of detaining the ship crew, pointing to that the SCA does not mind the departure or recrew operations provided the presence of the sufficient number of sailors to secure the vessel and in the light of the presence of the ship captain as he stands as the juridical guardian of the ship and the cargo aboard,” Rabie said in a statement.
The SCA initially sought $916m in compensation to cover refloatation costs, including repairs where the channel was damaged to move the vessel, bonuses for the rescue crews who worked throughout the jam, and a package for “loss of reputation”.
Now the SCA and its chairman and Managing Director, Admiral Osama Rabie, have agreed to reduce the bill by a third. The authority has reportedly offered payment terms for the $600m to the Ever Given’s owner Shoei Kisen. Shoei Kisen has also declared a general average on the goods on board, with shippers liable to shoulder a significant outlay to get the 18,000-plus containers aboard to their final destination in the Nertherlands.