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360Buy Jingdong Raised 700Mln in Fourth Round of Funding

02-17 12:32 Caijing
Kingdom Holding, the investment firm controlled by Saudi Prince Alwaleed bin Talal, was part of a consortium that invested a total of 700 million U.S. dollars in 2012 and early 2013 in Jingdong.

China's leading online retailer, 360Buy Jingdong Inc, said it has raised around 700 million U.S. dollars in the self-dubbed "D Round" financing, prompting further speculations that it is paving way for a stock market listing in competition with major rival and forerunner Alibaba Group.

Ontario Teachers' Pension Plan and Kingdom Holding, the investment firm controlled by Saudi Prince Alwaleed bin Talal, are among the new investors of the Business-to-Consumer company. Major shareholders including Tiger Management continued their investments in the fourth round of funding, which brings the company's total raisings to nearly 2.3 billion U.S. dollars, a record high for Chinese e-commerce companies.

The company told Chinanews.com that the new financing round showed that the company has already gained "strong recognition" from the global capital market. The new money will be used for corporation operation, investment in new business for the future and constructions of logistics, it said.

The investment of Kingdom Holding was worth about 470 million riyals, in line with the firm's "strategy of identifying high-growth companies potentially seeking to be listed on international capital markets within three years," according to the Wall Street Journal, citing an emailed statement from the company.

Pave way for IPO

Despite repeated denial of widespread IPO rumors from Jingdong's founder Liu Qiangdong, analysts believe the company is trying to steal a march by tapping the capital market ahead of the unlisted Alibaba, China's largest e-commerce company that is reportedly seeking a group IPO earlier this year.

News came out at the end of last year that Jingdong has begun contacting investment funds, said Li Chengdong, a senior e-commerce analyst. "The latest financing [by Jingdong] could create pressure for rivals, pave the way for IPO, improve investor morale while dispelling concerns of suppliers and government authorities for the company's future", he said.

The year 2013 also marks a proper timing for aggressive moves, analysts say, In addition to the company's growing valuation, accorded at roughly 7.35 billion U.S. dollars.

According to Chinese research firm iResearch, after posting a compound annual growth rate of over 150 percent, Jingdong maintained the top sport in the B2C industry in terms of proprietary trading, with its 49 percent of market share. The company reported revenue (including platform trading) of 26.9 billion yuan in 2011 and as much as 60 billion yuan in 2012.


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