NEW YORK (TheStreet) -- Alibaba (BABA) shares are down 0.05% to $85.64 in early market trading on Tuesday after the Chinese online retail company announced that it is selling its U.S. subsidiary, 11 Main, to rival OpenSky today.
Alibaba will continue to own a piece of the combined company following the sale.
Alibaba launched 11 Main last year in an effort to tap into the still growing U.S. e-commerce market.
OpenSky serves over 5 million members and 50,000 stores through its website compared to 11 Main's 2,000 merchants and 1.3 million orders processed as of April.
Insight from TheStreet Research Team
Helene Meisler of TheStreet's premium service blog 'Top Stocks' recently wrote a post entitled "The Market Still Reeks of Complacency". Here is what she had to say about Alibaba:
Alibaba had a nice run to fill the gap at $95 a few weeks ago and has since tapered back down from where it started. It is once again coming into some support as it tests the $84-$85 area, so I'd expect some sort of oversold bounce from there. It would take more bottoming action in the stock for me to like it again for more than a bounce candidate, now. Just look how many months it took to curl under and form the bottom that launched it to $95 from $90. But I do expect to see a bounce from that support line.
-Helene Meisler, 'The Market Still Reeks of Complacency', 6/21/2015