Chinese social-media giant Tencent Holdings and e-commerce platform JD.com plan to jointly invest US$863 million in online discount retailer Vipshop Holdings.
Tencent is putting in $604 million in exchange for a 7 per cent stake, while JD.com is paying $259 million for 5.5 per cent.
“We look forward to providing Vipshop with our audiences, marketing technology and payment support to help it offer branded apparel and other products to China’s rising middle class,” says Tencent president Martin Lau.
The deal comes as Tencent, which is a major shareholder in JD.com, pushes into retail, last week announcing it would buy a 5 per cent stake of department store company Yonghui Superstores. “The strength of Vipshop’s flash-sale and apparel businesses, as well as its outstanding management team, creates clear and strong synergies with us,” says JD.com chief executive Richard Liu.
After the Vipshop deal closes, Tencent will let the retailer capture traffic from WeChat, and JD.com will integrate Vipshop features into its app and help the firm reach sales targets, the companies say.
