(Yicai) March 18 -- Chinese e-commerce giant Alibaba Group Holding’s hypermarket chain RT-Mart and supermarket chain Freshippo will not be sold to state-owned food processing giant COFCO.

Executives at RT-Mart and Freshippo told Yicai yesterday that the rumors about them being sold to COFCO are untrue.

Alibaba decided to sell RT-Mart and Freshippo to COFCO for about CNY10 billion and CNY20 billion (USD1.4 billion and USD2.8 billion), respectively, according to recent market rumors. Alibaba and COFCO have already drawn up the framework agreement, which is pending approval from the former’s founder Jack Ma, the rumors also claimed.

Alibaba plans to focus on more lucrative core businesses, Executive Vice Chairman Joseph Tsai said during the earnings conference call for the fourth quarter of last year. Tsai also hinted the company would gradually close traditional physical retail stores.

In the fourth quarter of last year, Alibaba’s business group including Freshippo and Sun Art Retail Group, the operator of RT-Mart, logged a revenue of CNY47 billion, down 7 percent from a year earlier. The BG’s net loss widened 87 percent to CNY3.2 billion (USD444.6 million) in the period.

Even before that, rumors about a potential sale of Freshippo started circulating online. Freshippo denied such rumors in December last year.

The executives at Freshippo said that the firm will close six to seven outlets this month because property contracts expired but will try to find better locations nearby to meet consumer demand.

RT-Mart plans to open 21 new stores in Chinese provincial-level regions, including Sichuan, Hubei, and Jiangsu provinces, and complete the renovation of 90 outlets this year, said the executive at Sun Art Retail Group.

Editor: Futura Costaglione