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| The world's largest web
retailer posted disappointing results in July
(Agencies) |
After quite a few of negotiations, China's
non-state-run Joyo.com Ltd. has finally reached a deal with Amazon.com
Inc., the US E-commerce giant, which possibly meant a beginning of the
foreign Internet companies' landing in China.
Amazon.com Inc. announced the plan Thursday to pay US$75 million for
Joyo.com, who declared the deal on the same day. The 4-year-old Joyo.com,
is China's largest online retailer of books, music, videos, software,
gifts and toys.
"The purchase is a sign of good news for China's E-commerce," said Li
Tao, a senior executive of another Chinese online seller 8848.com.
"However, it might only change Joyo.com's fate itself, not the E-business
in China. I don't suppose it would affect the whole industry in the
country." he said.
Amazon has tried to buy Dangdang.com, a top B2C Chinese company, before
it planned to purchase Joyo.com, but failed due to its dominating stock
share strategy.
The deal is targeting the potentially huge Chinese market. According to
statistics released by CNNIC (China Internet Network Information Center),
58 percent of 87.5 million Chinese internet users favor online buy. The
fast-growing Chinese Internet market is estimated to be worth $16 billion
by 2005. By 2006, there will be 170 million netizens in China, while the number of
online buyers will hopefully rise from 6 million to 13.4 million.
According to the deal, Amazon.com would pay $72 million in cash and
assume employee stock options to buy Joyo.com.
Amazon said Joyo's Web retailing operations in China are run by
Joyo.com Ltd., a British Virgin Islands company founded in 2000. It
expects the deal to close in the third quarter.
(Xinhua)
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Updated: 2004-08-23 13:52