Southeast Asian emerging economies may look small individually but the region deserves respect. Its countries collectively hold around 650m people, the equivalent of half of China’s population.
That might explain why Alibaba decided to raise its stake in Singapore-based e-commerce company Lazada to 83 per cent, from just over half. Alibaba will spend $1bn, a fraction of its free cash flow, confirming its expansion out of its home market, without overpaying.
Lazada has e-commerce businesses in six Southeast Asian countries. It is the largest competitor in five out of the six countries it operates in. Founded in 2012 under Rocket Internet’s aegis, the German incubator sold its remaining stake on Tuesday at a profit of twenty times its investment.