Alibaba Invests in Chinese Logistics Company YTO Express

NEW YORK (TheStreet) -- Alibaba (BABA) announced Thursday that it has made a strategic investment in Chinese logistics company YTO Express to help both businesses improve logistics efficiency for their customers.

YTO Express, which was founded in 2000, is one of 14 logistics partners that Alibaba's affiliate Cainiao works with to deliver products from its online marketplaces. It services more than 2,300 Chinese cities and is one of only three logistics companies in the country that is licensed for aviation logistics, which it began offering last year.

Alibaba's Cainiao was founded in May 2013 in an effort to improve delivery for Alibaba. Investments in Cainiao's partner companies will serve to make those improvements that much easier.

Shares of Alibaba were up 0.46% to $87.93 in midday trading.

"The strategic investment in YTO Express reflects our commitment to improving quality and service standards in China's logistics industry," Judy Tong, senior vice president of Alibaba Group and president of Cainiao said. "As a platform, we look forward to working closely with partners who share our vision in developing an efficient logistics infrastructure and solutions that will drive development of China's logistics sector in order to fully satisfy our customers' needs."

Recently Alibaba has been making a bunch of investments in U.S. companies, including Zulily (ZU), Snapchat, Jet, and Lyft, but this investment takes the company back to its core, focusing on improving delivery in China.

"Logistics is a critical component in our overall ecosystem," an Alibaba spokesperson said. "We are able to provide our customers almost anywhere in China with a wide range of products and services. This latest investment in our distribution network allows us to become more efficient in serving our customers."

Alibaba declined to disclose the size of the investment.

From YTO Express's perspective, the investment from Alibaba "will boost our strategic product and service offerings to catalyze a breakthrough in efficiency within China's logistic sector," YTO Express Chairman Yu Weijiao said.

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