Jack Ma Contemplates SCMP Acquisition

In a statement  to the Hong Kong Stock exchange on Thursday, the board of South China Morning Post (SCMP) Group confirmed that the company has been approached by a group interested in acquiring its media assets. Although the official announcement did not disclose the identity of the third party, people familiar with the matter have revealed that Jack Ma, the founder of Alibaba, is the potential buyer. This negotiation marks the latest addition to Alibaba's media deals. In June, Alibaba invested 1.2 billion yuan ($187.8 million) in Yicai, a prominent financial news provider. More recently, Alibaba made a bid for Youku Tudou, a video-sharing platform and Chinese equivalent to YouTube.

Considering that SCMP's market value of $543.9 million is only a tiny fraction of Alibaba's market value of US$200 billion , some people including former reporter Andrew Collier remark that Alibaba's move does not immediately make sense business-wise. Collier stated, "it is not clear why Alibaba would want to own a newspaper in Hong Kong given that its revenues are a fraction of Alibaba's."

The political implications of the acquisition could provide a better explanation for Alibaba's interest in SCMP. As Hong Kong's most widely circulated English language newspaper, SCMP has garnered a reputation for reporting on stories that would normally be censored in mainland China. If this deal gives Alibaba a controlling majority of the media outlet, the Internet giant headquartered in mainland China could cause SCMP’s content to more closely align with the Chinese Communist Party’s ideals.