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Chinese video service Youku Tudou has accepted a massive $1.22 billion investment from Alibaba Group, the companies announced today.

Alibaba, which is planning an IPO in the near future, is China’s largest ecommerce company, which also competes with Google and PayPal within China. The new investment makes sense as Youku Tudou is easily the country’s biggest video site and can likely offer many future partnerships that are lucrative to both companies.

The new investment will give Alibaba and investment partner Yunfeng Capital each an 18.5 percent stake in Youku Tudou. And as part of the investment deal, Alibaba CEO Jonathan Lu will join the company’s board of directors.

“Alibaba’s investment will strengthen Youku Tudou as China’s largest online video platform and further differentiate our services and user experience,” said Youku Tudou CEO Victor Koo in a statement. “It will help us continue to build an immersive cultural entertainment platform that integrates online and offline entertainment.”

The investment still needs regulatory approval, but Youku Tudou expects the deal to close in the near future.

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