Alibaba acquires remaining shares of VC-backed UCWeb

The financial details of the transaction were not disclosed. However, the deal is understood to value UCWeb at $3.8 billion, which means it is likely to surpass Baidu's $1.9 billion acquisition of 91 Wireless in August last year to become the largest-ever acquistion of Chinese internet company.

Alibaba had brought its stake in the company to 66% last year after investing around $680 million across two tranches. AVCJ Research shows that Alibaba had been one of the earliest backers, investing around $12 million in the company alongside Ceyuan Ventures and Morningside Technologies in 2009. Nokia Growth Partners subsequently invested an undisclosed amount in 2010. Chinese super angel investor Lei Jun also invested in the firm.

UCWeb generates revenue by advertising and promoting applications, services and games via its smartphone services. The company has had more success than most Chinese internet firm looking to break into overseas market; its mobile browser is the biggest in India by market share.

Alibaba says it will integrate UCWeb into its mobile operations while UCWeb CEO Yongfu will become the head of a mobile business group within Alibaba. The group will work on internet browsers, search services, location-based services, the mobile gaming platform, mobile application distribution and mobile literature.

This is the latest in a series of acquistions by Alibaba in recent months ahead its US IPO later this year. In March, it agreed to buy 60% of Hong Kong-listed ChinaVision Media Group for HK$6.24 billion ($804 million). Prior to that it It bought the NASDAQ-listed AutoNavi Holdings, valuing the VC-backed digital mapping and navigation firm at $1.58 billion.

In January, it teamed up with Yunfeng Capital to buy a 54.3% stake in pharmaceutical data provider CITIC 21CN, a Hong Kong-listed subsidiary of Chinese conglomerate CITIC Group, for HK$1.33 billion. It also invested in New York-based luxury e-commerce site 1stdibs with a $15 million Series C investment. Furthermore, it led a $100 million Series B round of funding for China-based online education siteTutorGroup, with participation from Temasek Holdings and existing backer Qiming Venture Partners.

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