Alibaba Health Information Technology Ltd said on Friday controlling shareholder Alibaba Group Holding Ltd would sell HK$3.8 billion ($488.3 million) worth of health food and nutritional products businesses to the company, further developing it into Alibaba's healthcare flagship platform.

Alibaba Health will buy Ali JK Nutritional Products Ltd from Alibaba Group in a deal to be settled by the issue of 1.19 billion shares at HK$3.2 apiece, or a 6.16 percent discount to the last close, the company said in a filing to Hong Kong bourse.

The deal will bring a broader set of merchants into the online healthcare community, while the company will obtain more stable and sustainable revenue growth, the Hong Kong-listed firm added.

Alibaba Health saw its adjusted net loss narrowed to 98.3 million yuan ($14.3 million) for the year ended in March, from a 161.5 million yuan loss in the year-ago period amid rapid growth of its pharmaceutical e-commerce business.