JD.com Might List its Logistics Unit in the Future, Senior Executive Says

JD.com was reportedly trying to list its logistic unit after a $2.5 million funding round in 2018.

Author: Belinda Zhou   

China's second-largest online retailer, JD.com Inc. (Nasdaq: JD) was reportedly trying to list its logistics unit but didn't have time to prepare for an initial public offering, according to Reuters.

"Currently we don't have this plan but we think maybe in the future it is possible," Bing Fu, head of planning and development at JD Logistics, said.

The IPO of JD Logistics was discussed publicly as early as Jan 2018. Sources at Reuters said the Chinese e-commerce giant had kicked off a fundraising round at the logistics unit in 2018 with a target of at least $2 billion.

JD Logistics raised a total amount of $2.5 billion in February, which was the first public financing of Jingdong Logistics since it  became an independent operation in April 2017.  It ranked as one of the the largest single financing rounds in China's logistics industry.

The fundraising, as well as any ensuing spin-off, would give JD Logistics some independence and help it offer services to third-party clients. In addition, the funds will help JD better compete with Alibaba's logistics network Cainiao and delivery services firms such as SF Express, the people told Reuters.

After the completion of funding, JD.com still held a majority stake in Jingdong Logistics with 82 percent equity. It's valuation went from 80 billion yuan or $11.5 billion to 100 billion yuan or $14.4 billion, representing a 25-percent increase.

Investors included Gaochun Capital, Sequoia China and Tencent Holdings Ltd., China Merchants Group and others.

Sources from Chinese media said the conditions for the listing of Jingdong Logistics by the board of directors were that the total market value should be no less than $20 billion.

Shares in JD.com jumped 1 percent to $27.33 per American depositary share on Monday.