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A worker transfers items in preparation for the “Singles‘ Day” shopping festival at a storage facility of Suning in Shenyang in China's northeastern Liaoning province on October 24, 2018. Photo: AFP

Suning.com sells 23 per cent stake to Shenzhen International and Shenzhen Kunpeng

  • Suning.com shares rise in Shenzhen after the proposed deal was announced
  • Shenzhen International, a logistic and infrastructure facilities operator, said the acquisition would allow more logistic collaboration with Suning.com
Retailing

Shares of Shenzhen-listed Suning.com surged 10 per cent on Monday after Shenzhen International Holdings and Shenzhen Kunpeng Equity Investment Management agreed to acquire 23 per cent of the online electric appliance retailer for 14.8 billion yuan (US$2.28 billion).

Suning.com opened at 7.7 yuan on Monday, while Hong Kong-listed Shenzhen International also edged up by as much as 3.43 per cent to HK$13.28.

On Sunday, Shenzhen International, a logistic and infrastructure facilities operator, announced it would buy 744.8 million, or 8 per cent, of Suning.com shares, while Kunpeng Equity proposed to acquire another 1.39 billion, or 15 per cent of shares. The purchase price would be 6.92 yuan per share, according to company filings to the Hong Kong stock exchange.

At the proposed price, the acquisition will cost Shenzhen International 5.15 billion yuan and Kunpeng Equity 9.66 billion yuan.

A staff member works at a Suning warehouse in Nanjing, Jiangsu province, China, on October 15, 2018. Photo: EPA-EFE

Kunpeng Equity, a strategic fund management platform focusing on equity investment, is fully owned by the state-owned Assets Supervision and Administration Commission of the People’s Government of Shenzhen Municipality. It was set up to promote industrial development in the southern city of Shenzhen.

Suning.com is one of China’s largest retail chains with both physical stores and online presence, as well as various franchise outlets. It also runs its own warehouse and logistic distribution network across China.

In 2020, Suning.com ranked at 324th on the Fortune Global 500 list.

According to its filings on Sunday, Shenzhen International said the planned acquisition would allow the group and Suning.com to derive more synergy by collaborating in areas such as logistic operations, including the development of integrated logistic hubs and logistic service businesses, as well as project development and capital operation. This would strengthen the two entities’ existing cooperation and their logistic infrastructure, according to the company statement.

Suning.com’s integrated online and offline retail business can effectively promote the expansion of the group’s logistic service business and realisation of value-added income, according to Shenzhen International.

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