JD.com, Inc. announced on February 14, 2018, that it had done financial agreements for the financing of JD Logistics with investors such as Tencent, China Development Bank Capital FOF, China Merchants Group, and China Structural Reform Fund. JD.com will continue to exist as the major shareholder of JD Logistics with 81.4%. Financing of JD Logistics is estimated to close in the first quarter of 2018. This, however, is subject to customary closing conditions.
Chairman and CEO of JD.com, Richard Liu said that the funding prepares them to invest further in expanding their lead in the sectors for instance in areas like drones, automation, and robotics. By building out their logistics network it had enabled JD Logistics to become the leader in this industry as it is today. JD Logistics will continue supporting JD.com’s e-commerce business and the logistical needs for a broader scale of industries in the future.
CEO of JD Logistics, Zhenhui Wang mentioned that the financing will allow JD Logistics to strengthen its smart supply chain network with integration and accessibility. It is also an opportunity for both JD.com and JD Logistics to build China’s commercial infrastructure ecosystem.
The total amount raised in this funding round is approximately $2.5 billion. The financial merger seems to be the choice that both parties took to enhance their collaborative effort. Not only will this benefit them, but it could also pave the way for other companies to act when it comes to financing and widening their network in this industry.