The deal is primarily stock with a small cash component although the acquisition price or terms were not disclosed. Alibaba also claims this is the biggest deal in Chinese Internet history, surpassing Baidu’s $1.9 billion acquisition of 91 Wireless last year.
Alibaba had previously mentioned in its IPO filing that it owns 66% stake in UCWeb in form of convertible preferred shares, which the company had acquired over several years through several rounds of investments, the last of which was completed in April 2014. The company’s total investment in UCWeb was at $539.3 million (RMB3.358 billion) as of December 31, 2013.
Post acquisition, Alibaba and UCWeb will form the UCWeb Mobile Business Group which will apparently be responsible for Internet browsers, search services, location-based services, its mobile gaming platform, mobile application distribution and mobile literature services. UCWeb CEO Yu Yongfu will act as the chairman of this business group and will be part of Alibaba’s “strategic decision-making committee”.
Alibaba had earlier mentioned in its IPO filing that through its UCWeb investment, it is able to leverage the company’s expertise as a developer and operator of mobile web browser to improve its non e-commerce mobile offerings like mobile search. In April this year, Alibaba had also formed a joint venture with UCWeb to launch a mobile content search engine called Shenma.
UCWeb in India
UCWeb had setup its second headquarters in India in April last year, in a bid to push its UC mobile browser among Indian users. A month later, the company had stated plans of investing $170 million in expanding its global operations, majority of which was expected to be deployed in India to build a mobile Internet ecosystem.
As per StatCounter, the company had surpassed Opera Mini as the most popular mobile browser in India in July 2013 and currently owns 34.92% market share in the country, as compared to Opera’s 25.14% share.
The company however hasn’t disclosed new India user base numbers for quite sometime now and the last number is from December 2012, wherein it had claimed to have 40 million users in India. Globally, it had claimed to have surpassed 500 million quarterly active users in March this year.
Earlier in January, Vuclip had also tied-up to power UCWeb browser’s video channel. This deal gave Vuclip access to UCWeb’s user base, although it hadn’t paid UC Browser for this inventory. Last month, New Zealand-based cricket technology company CricHQ had also tied up with UCWeb and Nokia to launch its cricket scores app in India.