Google to invest $550 million in China e-commerce giant JD.com
Google to invest $550 million in China e-commerce giant JD.com
Google will invest $550 million in Chinese e-commerce powerhouse JD.com , part of the U.S. internet company`s efforts to expand its presence in fast-growing Asian markets and battle rivals including Amazon.com https://goo.gl/fsZk2g)
In March, Reuters reported a new programme where Google was teaming up with retailers like Walmart, allowing them to list their products on Google Search, as well as on the Google Express shopping service to better compete with Amazon.
Google is also reportedly pursuing picking up a stake in India`s Flipkart, where Walmart picked up a 77 percent stake for $16 billion.
Google declined to comment on the rumoured Flipkart deal. STEPPING UP INVESTMENTS IN ASIA
Google is stepping up its investments across Asia, where a rapidly growing middle class and a lack of infrastructure in retail, finance and other areas have made it a battleground for U.S. and Chinese internet heavyweights. Google recently took a stake in Indonesian ride-hailing firm Go-Jek.
The JD.com investment is being made by the operating unit of Google rather than one of parent company Alphabet`s investment vehicles.
Google will get 27.1 million newly issued JD.com Class A ordinary shares as part of the deal. This will give them less than a 1 percent stake in JD, a spokesman for JD said.
For JD.com, the Google deal shows its determination to build a set of global alliances as it seeks to counter Alibaba, which has been more focused on forging domestic retail tie-ups. Japan`s SoftBank Group Corp , which is making big internet investments around the globe, is a major investor in Alibaba.
Morningstar analyst Chelsey Tam said the investment will help JD.com expand into developed markets such as the United States and Europe, where it has lesser exposure compared to Google.
"This partnership with Google opens up a broad range of possibilities to offer a superior retail experience to consumers throughout the world," said Jianwen Liao, JD.com`s chief strategy officer, in a statement.
Company officials said the deal would marry Google`s market reach and strength in analytics with JD.com`s expertise in logistics and inventory management.
The investment may give Google access to more consumer data, which can be used to boost usage of Google Shopping, said Morningstar analyst Ali Mogharabi.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.