Chinese e-commerce giant JD has made a strategic investment in Gome Retail, buying US$100 million of convertible bonds. 

Gome Retail is one of China’s largest electronic retailers. The company is in the midst of a major transition and restructure from a brick-and-mortar-dominated format into a multichannel digital business anchored around its online platform. It is also expanding its physical store network into low tier cities and rural locations across China.

Gome had already opened a flagship store on the JD site and the two companies say the financial tie-up will strengthen the cooperation between them. 

In the next step of their alliance, JD and Gome Retail will look to use their respective online and offline strengths to achieve more synergies, including integrating their supply chains and sharing logistics and installation functions, and other business-related aspects such as financial services.

During the last year or so, JD has invested in Five Star, D Phone, Lecoo and other businesses in the electronics retail space, creating diversified formats, such as JD E-Space, JD Computer and Digital Products Stores and JD Home Appliance Experience Stores. 

“The strategic cooperation with Gome not only marks the acceleration of JD’s integration and opening up, but also represents the company’s commitment to promote an ecosystem approach by relying on its infrastructure, including supply chain, logistics, and technology,” the company said in a statement. 

“It also represents JD’s commitment to work together with partners for more efficient and sustainable development.”