China's Alibaba preparing for tough "winter"

Chinese Internet firm Alibaba is looking to invest in its group and is not on the hunt for acquisitions as it believes a tough "winter" is coming, its founder Jack Ma told Reuters on Thursday.

"I raised money (through an IPO) and one of the main reasons was to prepare for the winter," he said in an interview in London.

"We as a company have gone through the year 2000, when the Internet bubble burst. We know how tough it is when you don't have money and I think these tough days are coming very, very soon and these tough days will last long.

"So to keep the cash in hand is key, don't try and go out to grab some cheap deals."

Alibaba is the parent company of e-commerce firm Alibaba.com , an online business-to-business site which connects companies looking to import and export Chinese goods and which was founded in 1999 as a bulletin board for businesses to post trade leads.

Alibaba.com raised $1.49 billion in Hong Kong's most popular initial public offering in November last year. Its shares have since slipped however due to fears surrounding its exposure to the United States and an economic slowdown.

Ma said he thought any slowdown in the United States would hit large companies and have a smaller impact on the small-to-medium enterprises (SMEs) with which it mostly deals.

"I believe the next three years will be tough days for big companies but a great time for SMEs," he said.

One large group that Alibaba is associated with is Yahoo Inc and Ma declined to comment on Microsoft Corp's bid to acquire the U.S. Internet group.

Yahoo owns 39 percent of Alibaba and a source familiar with the situation told Reuters recently the Chinese group was seeking investors to buy out Yahoo's stake to stop Microsoft from getting the Alibaba stock.