Alibaba Group Holding Ltd (BABA.N) is investing $200 million in photo-messaging app Snapchat, a source familiar with the deal said, striking its latest Silicon Valley deal as the Chinese ecommerce company builds up mobile services.
The investment values the Los Angeles-based company at around $15 billion, according to Bloomberg, citing people familiar with the situation. This places the four-year-old company into the top ranks of privately held startups.
With Snapchat blocked in China it is unclear what immediate value the startup would bring to Alibaba, which handles more online commerce than Amazon.com and eBay Inc) combined.
Alibaba, which has seen a steady increase in shopping via smartphones and tablets, has made it a priority to develop mobile services. But its attempt to create a popular messaging app has not had much success, coming up against arch-rival Tencent Holdings Ltd's ubiquitous WeChat service.
Tencent, China's biggest social networking and entertainment company, also invested in Snapchat in 2013, TechCrunch reported at the time.