JD Files for $2 Billion Hong Kong Listing

News of the filing emerges a day after Minnesota judge denied the motion to dismiss the company from any potential liability for the alleged rape.

Author: Anna Vodopyanova   

JD.com Inc. (Nasdaq: JD) traded up 2% Wednesday afternoon, at $44.45 per American depositary share, on news that it has confidentially filed for possibly Hong Kong's largest flotation of 2020.

The e-commerce giant No. 2 in China, JD, seeks to raise up to $2 billion in its secondary offering, exact amount yet to be confirmed, Bloomberg reported, citing unnamed sources.

The move follows the $13 billion listing by Alibaba Group (NYSE: BABA; HKEX: 9988) in November after the Stock Exchange of Hong Kong relaxed its listing rules last year with an aim to attract high-tech giants. At the time, Alibaba called its Hong Kong listing "a homecoming" after company founder Jack Ma had for years said BABA shares were undervalued by Wall Street investors.

Alibaba's offering paved the way for other U.S.-listed giants, a number of which have reportedly begun talks for the listing, though the Covid-19 outbreak dampened their plans and market valuations. Among those companies were fast-food chain operator Yum China Holdings Inc. (NYSE: YUMC), also possibly eyeing a $2 billion listing in the city.

Reports also surfaced that Chinese search engine Baidu Inc. (Nasdaq: BIDU), Asia's largest booking platform Trip.com Group Ltd. (Nasdaq: TCOM), and tech giant NetEase Inc. (Nasdaq: NTES) were also considering a secondary listing in Hong Kong.

And while the travel market has plunged and it will take time to fully recover, e-commerce has seen a revival in China in recent weeks as the quarantine was lifted, Caixin Global reported.

Separately, on Tuesday, news surfaced that the JD.com will remain a defendant in the alleged rape lawsuit. Hennepin County District Judge has declined the motion to dismiss JD's liability in the alleged rape of a Minnesota University student by the company's founder, Richard Liu, opening up the company to what will surely be a massive lawsuit. 

In official company statements, JD has always declined to comment on the matter, urging to detach the matters of its business from its chairman's alleged actions. Since the plunge JD's shares took at the time of the incident in September 2018, its stock has fully recovered.