Wal-Mart Stores Inc. is switching strategies in China, striking a deal to forge a partnership with one of the country’s largest e-commerce players rather than continue trying to crack the fast-growing but competitive market on its own.
Wal-Mart on Monday said it will sell its Yihaodian website to JD.com Inc.—the second-largest online retailer in China, after Alibaba Group Holding Ltd. U.S.-based Wal-Mart will receive a 5% stake in JD.com, valued at roughly $1.5 billion at recent prices, and access to JD.com’s delivery network and shoppers.
JD.com American depositary shares rose 4.6% to $21.06 on the Nasdaq Stock Market amid the news, which was reported earlier by The Wall Street Journal. Wal-Mart shares rose slightly to $71.10 on the New York Stock Exchange.
The Chinese retail landscape has become cutthroat as the economy slows and consumer buying behavior shifts online and to mobile-phone purchases much faster than in the U.S. JD.com and Alibaba are battling for customers, promising delivery in under an hour in some cities and pushing into rural towns.
(Source: Wall Street Journal )