Alibaba has agreed to pay HK$22.4 billion (US$2.9 billion) to acquire a 36.16% stake in Hong Kong-listed Sun Art Retail Group, which runs 446 Auchan Retail and RT-Marts, one of the biggest hypermarket chains in China, Caixin reported.

According to the announcement, Taobao China will directly hold 26.02% of the stake. The remaining 10.14% will be indirectly held by Ji Xin, the controlling shareholder of Sun Art Retail Group, also a joint venture set up by Ruentex and Auchan Retail.

The valuation of the Sun Art Retail Group was set at HK$62 billion, with an offer price of HK$6.5 dollar per share. The offer represents a premium of 150.62% to the net asset value per share attributable to shareholders as of June 30.

Alibaba also signed an agreement to cooperate with Sun Art Retail, Auchan Retail and RT-Mart in the digital makeover of grocery shopping. The agreement will be effective after the buy-in deal is closed.