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Kul Bhushan · · 1 min readSuning.com gets $1.36b bailout from a consortium of Alibaba, Xiaomi, others
“A consortium led by the Jiangsu government is taking a stake in Suning.com, the retail arm of billionaire Zhang Jindong’s Suning Group, marking the latest move in China’s effort to bail out its heavily indebted conglomerates,” South China Morning Post reported.
Details
- Suning, one of the largest non-government retailers in China, will sell 1.58 billion shares or 16.96% of the firm to a group of investors. The total value of the deal is estimated to be about US$1.4 billion.
- The group of investors include Alibaba, Midea Group, Hair Group, Xiaomi, and TCL, along with the Nanjing state asset management committee and the Jiangsu provincial government.
Dive Deeper
- The bailout means company founder Zhang will no longer have control over Suning.com, which was once known for its rapid diversification. Its most notable one is its 2016 acquisition of a controlling stake in the Italian football club Inter Milan for US$319 million.
- Suning.com in a stock filing said it expects net losses of up to 3.2 billion yuan (US$495 million) for the first half of the year, citing several challenges, including a 30% dip in sales revenues for the second quarter year on year.
Editing by Miguel Cordon and September Grace Mahino
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