In the midst of a clampdown in China on domain name registrations, Chinese business-to-business online company Alibaba.com has completed its share purchase agreement of a local website domain name registrar.

Alibaba has completed the expected share purchase agreement with China Civilink (Cayman), which operates in China as HiChina Web Solutions, a website domain name registration and web services firm. This was the first of a two phase deal with Alibaba.com acquiring 85% of HiChina now, and the option to acquire another 14.67% equity interest from HiChina's founders pending HiChina reaching certain performance targets.

The total consideration of both phases is CNY539.98 million in cash.

Chinese domain name supervision organization China Internet Network Information Center announced that starting from 21:00 on December 14, 2009, it closed domain name registrations for individual users who are not purchasing domains on behalf of companies or organizations. It is still unclear how this will impact HiChina's revenues.

Prior to this sudden announcement, China's central television station criticized domain name registration service providers and agencies for false, inaccurate or incomplete information in the registration process. In response to the criticism, CNNIC said it has implemented an examination and punished three domain name registration service providers and agencies, including some of HiChina's rivals such as Zhengzhou Dahuang Network Development Company, Beijing Xinnet Digital Information Technology Company, and Beijing Blinux Network Technology Company.

Related Links:

• http://www.miit.gov.cn

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