Alibaba Group Holding Ltd, China's largest e-commerce firm, offered to buy AutoNavi in a deal valuing the Chinese digital mapping and navigation firm at $1.58 billion.

Alibaba, which already owns 28 per cent of AutoNavi, has been trying to expand its product line-up to better compete with Chinese rivals Tencent and Baidu .

More than half of AutoNavi’s revenue comes from licensing map data for dashboard navigation systems used in cars. Customers include Audi, BMW and General Motors. AutoNavi, which went public in 2010, also provides map software for Samsung Electronics’s smartphones as well as services to China Mobile and Google.

Alibaba, which is 24 per cent owned by Yahoo, is expected to go public in the US this year in a float likely to value it at more than $60 billion. – (Reuters)