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JD.com to raise USD 1 bln for healthcare subsidiary

CKN
minutes 2019/05/13 06:07:42
2,310
JD health; CICC Capital; Baring Private Equity Asia

May 13, 2019 (China Knowledge) - Chinese e-commerce company JD.com is raising more than USD 1 billion for its healthcare subsidiary JD Health from investors such as CICC Capital and Baring Private Equity Asia.

Last Friday, the Chinese e-commerce giant has announced that it has entered into definitive agreements for non-redeemable Series A preferred share financing for JD Health with the shares on offer representing more than 14.5% of equity interest in JD Health on a fully diluted basis.

JD.com will still remain as the majority shareholder of JD Health even after the transaction and the new funds will help JD Health to expand its core business as well as attract new talent and explore new initiatives in the healthcare sector.

JD.com is now looking to expand its ecosystem by venturing into the healthcare sector that Chinese tech giants are increasingly investing in.

The company has also renewed its strategic partnership with Tencent Holdings which will allow the former to continue using the latter’s WeChat platform as access point and traffic support, as well as cooperation in communications, advertising and membership services which are estimated to cost over USD 800 million over the next three years.

JD.com net revenues stood at RMB 121.1 billion for the first quarter this year, up 20.9% year-on-year. The company expects net revenue for the second quarter to reach between RMB 145 billion to RMB 150 billion for a growth rate of between 19% to 23% year-on-year.

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