The biggest multinational tech company Google announced on Monday that it will invest an amount of $500 million in Chinese second largest e-commerce platform called JD.com. Both the companies have mentioned this funding as an association that will help in the promotion of JD.com products on Google’s shopping service.
In return for the funds, Google will receive more than 27 million newly issued Class A ordinary shares of JD.com at an issue price of $20.29 per share. This would also be helpful for the Chinese company to expand its existence beyond China and Southeast Asia to other markets in the US and Europe.
“This partnership with Google opens up a broad range of possibilities to offer a superior retail experience to consumers throughout the world,” stated Jianwen Liao, JD.com’s chief strategy officer.
With its headquarters in Beijing, JD.com is one of the two largest B2C online retailers in China by transaction volume and revenue. The company was founded in 1998 while its B2C business went online in 2004. JD.com is the world’s leading company in high tech and artificial intelligence (AI) delivery with the help of drones, autonomous technology and robots, and owns the largest drone delivery system.
The basic purpose of both the technology firms is to work in association and develop a retail infrastructure that can improve the shopping experience and reduce friction in a number of markets. The goal is to bring together the experience of JD.com in supply chain and logistics with the huge customer reach and marketing experience of Google.
Apart from this, the investors of JD.com comprise of Chinese social media company Tencent Holdings Ltd, Alibaba Group Holding Ltd, and Walmart Inc. It has also partnered with Carrefour SA which is a French retail company.