Chinese E-commerce Giant JD.com (NASDAQ: JD) announced on Wednesday that it is expecting to raise $2.5 billion for its logistic subsidiary, JD logistics, by selling its stakes on JD logistics. According to JD.com, the deal would enable it to invest more in technologies which are transforming the e-commerce industry.
In the statement, JD.com announced that it has entered into agreements with investors including Hillhouse Capital, Sequoia China, China Merchants Group, Tencent, China Life, China Development Bank Capital FOF, China Structural Reform Fund and ICBC International, among others. After completing this round of financing, JD.com will remain the majority of the JD Logistics with an 81.4% stake. And this deal is expected to be completed within this quarter.
JD.com has been operating its self-owned logistics system since 2007, and established this JD Logistics as a stand-alone subsidiary in April 2017. Currently, JD.com owns and operates six major logistics networks, including normal-sized items, bulky items, cold chain, B2B, cross-border and crowd-sourced (New Dada), covering over 99% of China’s population.
Richard Liu, Chairman and CEO of JD.com, said in the statement, “Our decision early on to build out our own logistics network has paved the way for JD Logistics to become the industry leader it is today. The shift throughout global e-commerce towards our model is vindication of the path we chose. This current funding round sets the stage for us to further invest in expanding our lead in the sector in areas like automation, drones and robotics. JD Logistics will continue to support both JD.com’s e-commerce business and the logistical needs for a wide range of industries for years to come.”