Suning.com announces stake sale to Alibaba-led consortium- PingWest

Suning.com announces stake sale to Alibaba-led consortium- PingWest

Suning.com announces stake sale to Alibaba-led consortium

14 hours ago

On Monday, Chinese retailer Suning.com announced a deal to sell a 16.96% stake to a consortium led by Alibaba's digital marketing arm Alimama and an equity investment firm owned by East China's Jiangsu Province where Suning is headquartered.

Details: Funded by state-owned capital and industrial investment, the consortium is said to improve operations and management at the retail arm of Suning and help with its transition toward a retail service provider. 

Smartphone giant Xiaomi, home appliance manufacturer Haier, Midea and TCL also joined the consortium.

Meanwhile, the retailer announced the end of an agreement in late February to sell a 23% stake to two state-owned firms, Shenzhen International Holdings and Shenzhen Kunpeng Equity Investment Management.

After the deal, the consortium will become the third largest shareholder, holding 16.96% of the shares. Suning's chair, Zhang Jindong, and Suning Holdings Group will hold a 20.35% in Suning.com, while Alibaba's Taobao will remain the retailer's second-largest shareholder with a 19.99%stake. 

Context: The liquidity crisis of Suning.com burst out last year when its parent company booked consecutive losses in its core retail business and the debit scaled up amid aggressive expansion into multiple sector including retail estate, telecom, football clubs.

The e-commerce platform expects colossal net losses of up to 3.2 billion yuan ($495 million) for the first half of the year, according to its stock filing late Monday. By comparison, its losses for the first half of last year stood at 167 million yuan.

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