The Chinese e-commerce giant has entered into agreements with investors – including Hillhouse Capital, Sequoia China, China Merchants Group, and Tencent, among others – for the financing of its supply chain and distribution subsidiary, JD Logistics.
Chinese e-tailer JD.com has raised $2.5 billion in new funding for its logistics unit JD Logistics.
Chinese e-commerce giant JD.com, Inc., which calls itself the largest retailer in the country, has raised $2.5 billion in new funding for its logistics unit JD Logistics, according to a statement from the company.
Investors in the funding round include Hillhouse Capital, Sequoia China, China Merchants Group, Tencent, China Life, China Development Bank Capital FOF, China Structural Reform Fund, ICBC International, and others, according to JD.com.
Upon completion of the investment agreements, expected to close in the first quarter of 2018, JD.com will remain the majority shareholder of JD Logistics with an 81.4 percent stake.
Launched as a separate business in April 2017, JD Logistics operates an extensive network of company-staffed warehouses and distribution centers supporting its e-commerce operations across China. JD.com has also made investments in infrastructure in Southeast Asia, but currently has no logistics presence in the United States.
“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,” Richard Liu, chairman and CEO of JD.com, said in a statement. “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,” he added. “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.”
“Over the decade that we have built out our operations, initially to support our own e-commerce business, we have created the most efficient, integrated and user-friendly logistics network in China,” added Zhenhui Wang, CEO of JD Logistics. “This financing will enable JD Logistics to further enhance its smart supply chain network with openness and integration. It is a major step, which will speed up our collaborative efforts with leading industry partners and build China’s next-generation commercial infrastructure ecosystem.”