Alibaba Founder and Chairman Jack Ma gestures as he speaks at the Big Data Expo in Guiyang, Guizhou province, May 26, 2015. Picture taken May 26, 2015. Reuters/China Daily

Alibaba Pictures Group Ltd., the entertainment unit of China’s largest online shopping company Alibaba Group Holding Ltd., will sell shares to a select group of investors to raise close to $1.6 billion, which it said it expects to spend on acquisitions.

Alibaba Pictures will sell about 4.2 billion shares at a price of HK$2.90 each to net about HK$12.12 billion ($1.56 billion) after fees to the brokers of the sale and other deductions, the Hong Kong-traded company said in a filing on Thursday. Credit Suisse and Morgan Stanley have been mandated to find buyers for the shares, while Alibaba Pictures is yet to identify acquisition targets, according to the filing.

By selling the shares, diluting outstanding ones by about 20 percent, the movie unit is taking advantage of a strong rally in its value. Shares of Alibaba Pictures have risen over 145 percent year-to-date, in comparison with an 18 percent gain for the main Hang Seng index.

Alibaba Pictures was China Vision Media Group Ltd. before billionaire Jack Ma’s Alibaba bought a controlling stake in the company for $804 million in March last year.

Ma is building an ecosystem of Internet-based products and services that will typically be tapped by consumers and businesses using wireless devices such as smartphones. Online video and other content would likely play a vital role in acquiring and retaining users. Alibaba’s competitors include Xiaomi Corp., China’s largest smartphone maker, which has said it will invest $1 billion in online video.

Also Thursday, Alibaba said it has agreed to invest 1.2 billion yuan ($193.6 million) in China Business News (CBN), a Chinese financial media company part of Shanghai Media Group. CBN is China’s leading financial media group including television, radio, newspaper, magazine and news agencies, Alibaba said in a press release.

The deal will create a financial data and information services company that will exploit the e-commerce giant’s data-crunching capabilities to “help Chinese small and medium enterprises tap a rich mine of financial data,” the company said in the release.

“The era of Data Technology is here and it will surpass the Information Technology era. The DT era is about transparency, sharing of information and enabling others. Alibaba is excited about the possibilities of the DT era and how it can bring value to society,” Ma said in the release.