JD.com, an online direct sales firm, recently announced that it has entered into a partnership with Tencent, an internet service provider serving the largest online community in China. Under the terms of this agreement, JD will be provided with a portion of Tencent’s e-commerce businesses and assets, enabling both the companies to offer advanced e-commerce services to mobile and internet users in China. The partnership also installs Martin Lau, president, of Tencent, as the latest member of JD's board of directors.
JD will now be able to leverage Tencent's large mobile and internet customer base, focusing on key areas like mobile access points, traffic support and e-commerce activities. This will enable JD to offer superior quality of service, provide a better shopping experience to a wider customer base, increase direct sales and improve marketplace business practices. The company will be established as Tencent’s preferred partner for all physical goods e-commerce businesses. Tencent, in turn, will utilize JD's advanced e-commerce services to offer enhanced customer experiences. Online payment services will be coordinated by both parties.
In a statement, Lau said, "We are pleased to combine our thriving and fast growing eCommerce initiative with JD's in this strategic partnership, and support them to further grow and provide even better eCommerce services to our collective users. Our strategic partnership with JD will not only extend our presence in the fast-growing physical goods eCommerce market, but also allow us to better develop our enabling services such as payment, public accounts and performance-based advertising network to create a more prosperous ecosystem for overall eCommerce activities on our platforms."
As a part of the strategic partnership, JD will acquire 100-percent interests in Tencent's QQ Wanggou B2C and PaiPai C2C marketplace businesses, logistics personnel and assets, and a minority stake in Yixun, with an understanding that it may acquire the remaining stake of Yixun in future. Meanwhile, JD will issue new shares to Tencent. The company will hold approximately 15 percent in JD at the end of the transaction.
Edited by Blaise McNamee