Shanghai, China (4E) – Tencent Holdings Ltd. is partnering with JD.com Inc. to form an alliance aimed at boosting their position in order to compete with Alibaba Group Holdings Ltd.
The Chinese internet giant Tencent agreed to acquire a 15 percent stake in JD.com, China’s second-biggest e-commerce firm, for $214.7mn.
Under the terms of the deal announced Monday, Tencent will help drive traffic to JD.com’s e-commerce services using its QQ and WeChat mobile messaging services. Meanwhile, JD.com will take over Tencent’s e-commerce units PaiPai and Wanggou.
Tencent, Asia’s largest Internet company, also agreed to purchase another 5 percent stake in JD.com once the initial public offering (IPO) is complete.
In January, JD.com filed an IPO to raise $1.5bn, which may be the largest stock offering of a Chinese Internet firm in the U.S.
The Russian billionaire Yuri Milner’s DST Global-backed JD.com had 35.8 million active customer accounts as of end of September, according to the company’s filing with the U.S. Securities and Exchange Commission. Tencent had over 272 million monthly active users at the end of the third quarter, mostly in China.