Suning Commerce Group, one of the largest retailers in China, has announced that it will reorganize its financial businesses such as third-party payment, crowdfunding, insurance sales, and fund sales into the new Suning Financial platform. It introduced Suning Jinkong, a wholly-owned subsidiary of Suning Commerce Group’s President Zhang Jindong, and its core employees as new strategic investors on Sunday.
According to the announcement, Suning Jinkong will invest RMB 5.834 billion (USD 900 million) and hold a 35% stake in Suning Financial, while core staff will invest RMB 833 million and hold a 5% stake in Suning Financial. After this round of funding, the valuation of Suning Financial will amount to RMB 16.667 billion.
Screenshot from Suning.com
The funding will effectively meet the capital needs and support the development of Suning Financial. Additionally, the employee stock ownership model aims to rouse the enthusiasm of core employees and bring in top-level talent to strengthen Suning’s team.
After three years of development, Suning has built a comprehensive financial services ecosystem, covering third-party payment, crowdfunding, insurance sales, and fund sales. The company landed USD 4.6 billion in financing from China’s largest e-commerce platform Alibaba last year.
According to Suning’s 2015 annual report, Suning has 230 million registered e-commerce customers and 130 million registered members of Suning Yifubao, the company’s online payment processing platform. The revenue from its financial businesses grew by 254.9% in 2015, while its net profit increased by 435.54%.
Previously, Chinese internet giants have taken steps to integrate their financial businesses. Alibaba established its financial affiliate Ant Financial in 2014, while Baidu built its financial services group at the end of last year.
(Top photo from takungpao.com)