The Alibaba Group, one of China’s largest businesses, is teaming with several top Russian firms to launch a new e-commerce site, the companies announced on Tuesday, a move that comes as tensions boil between the two countries and the U.S.
Involved in the deal are Alibaba and Mail.ru Group, a top internet company in the Kremlin, as well as the sovereign-wealth Russian Direct Investment Fund and MegaFon, a Russian telecommunications firm. The companies plan to create what they labeled as “a one-stop destination for consumers.”
Alibaba also plans to leverage its owernship of AliExpress, Russia’s top e-commerce site, to increase its customer base in the country and “digitize and transform the retail value chain.”
“Our experience in China and other markets around the world makes us uniquely qualified to help build the future infrastructure of commerce in Russia and neighboring countries,” Alibaba Group President Michael Evans said after announcing the deal at the Eastern Economic Forum in Russia.
After the transaction is closed, the Chinese firm will own a 48 percent stake in AliExpress, a 24 percent stake in MegaFon, 15 percent stake in Mail.ru Group and a 13 percent stake in the Russian Direct Investment Fund.
The deal comes as President Trump prepares to levy tariffs on an additional $200 billion in Chinese goods, bringing the total value of products impacted by the new tax to $250 billion. Trump has threatened to place duties on all the goods imported from China.
As Alibaba furthers its partnership with Russian companies, the Republican-led Congress is trying to pass a new sanctions bill targeting the Kremlin after Trump signed a separate package into law earlier this year. The effort is part of the continued fallout from the U.S. intelligence community’s report that Russian President Vladimir Putin sought to influence the 2016 elections to assist the Trump campaign.
The Trump administration previously expelled 60 Russian diplomats after a Kremlin-linked nerve agent attack in the U.K.
