Carrefour sells 80 per cent of its Chinese retail operations to Suning for 4.8 billion yuan
- Suning shares rise as investors cheer the deal
- Suning says it plans to use its digital technologies to enhance the competitiveness of Carrefour’s 210 hypermarkets nationwide
Shares of Suning.com jumped 3.6 per cent on Monday after the Chinese electronics retailer and e-commerce giant agreed to buy an 80 per cent stake in the Chinese operations of French supermarket retailer Carrefour for 4.8 billion yuan (US$699 million) in cash, reflecting how digital technologies continues to redraw the consumer landscape in the world’s second largest economy.
Suning said in a filing to the Shenzhen Stock Exchange on Sunday evening that Carrefour will retain a 20 per cent share in the businesses and two out of seven seats on Carrefour China’s Supervisory Board.
The deal is subject to approval by Chinese regulators.
Suning said the stake in Carrefour China would help it reduce procurement and logistics costs.
The Chinese company pledged to better use digital technologies to enhance the competitiveness of Carrefour’s 210 hypermarkets across the mainland.
“Technologies ranging from virtual reality and big data to artificial intelligence have to be used in developing shopping outlets in China,” said Chen Xiao, chief executive of Shanghai Yacheng Culture, a firm that deals with marketing and branding for retail companies. “Leading Chinese players are in the front-running position to conduct the transformation.”
Carrefour said its decision to retain a 20 per cent share reflects the strategic importance of China’s retail market.