Dufry, Alibaba Group Agree to Form Joint Venture in China and Plan Equity Investment

By Olivia Bugault

Dufry AG said Monday that it has agreed with Alibaba Group Holding Ltd. for the formation of a joint venture in China, while the tech giant plans to invest in Dufry.

The Swiss-based travel retailer said the joint venture in the Chinese travel retail market will be owned at 51% by Alibaba and 49% by Dufry.

"In connection with this collaboration, Alibaba Group will invest in Dufry up to a maximum of 9.99% of the post-offering share capital and will participate in its ordinary capital increase, which is subject to approval of Dufry's shareholders at its upcoming EGM on 6 Oct. 2020," the company said.

Dufry previously secured a commitment to invest up to 415 million Swiss francs ($450.8 million) in shares purchase from Advent International Corporation. This, together with the planned investment with Alibaba, means Dufry will propose an issuance of up to 25 million shares, or roughly CHF700 million in gross proceeds, during its extraordinary general meeting, it said.

Alibaba plans to buy shares at the same price as Advent International, or CHF28.50 per share, but won't invest more than CHF250 million, Dufry said.

"The envisaged proceeds are planned to be used to finance the previously announced acquisition of all remaining equity interest in Hudson Ltd. and for general corporate purposes, which may include the setup and operations of the above-mentioned JV with Alibaba Group to pursue growth opportunities in China and to accelerate Dufry's digital transformation," it said.

Write to Olivia Bugault at olivia.bugault@wsj.com

(END) Dow Jones Newswires

October 05, 2020 01:56 ET (05:56 GMT)

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