Naspers-backed Tencent and China’s ecommerce firm JD.com have jointly invested approximately US$1.3 billion in cash and resources in to acquire stake in Bitauto and US$250 million in cash in YiXin Capital Limited, a subsidiary of Bitauto primarily engaged in e-commerce-related automotive financing platform business.
The deal will see the three firms provide enhanced online automotive transaction services to car buyers across China. Bitauto Holdings Limited runs Internet content and marketing services for China’s fast-growing automotive industry.
In a statement, Mr. Martin Lau, President of Tencent, added “With the pooled auto e-commerce resources of Bitauto and JD.com and our extensive user base and analytics and auto-related media assets, we collectively can build an efficient online platform to facilitate online automotive transactions and provide one-stop financing solutions to auto buyers in China. We look forward to collaborating with them to better serve users and expand our catalogue of online-to-offline service offerings.”
JD.com will invest US$400 million in cash and approximately US$750 million of resources for a total of approximately US$1.15 billion of newly issued ordinary shares from Bitauto.
Tencent, 34% owned by Naspers, will buy US$150 million of newly issued ordinary shares from Bitauto at US$73.31 per share in Bitauto. In addition, JD.com and Tencent will invest US$100 million and US$150 million, respectively, in newly issued series A preferred shares of YiXin Capital.
JD.com and Tencent will hold 25% and 3.3% of Bitauto respectively while JD.com and Tencent will hold 17.7% and 26.6% of YiXin Capital, respectively, upon closing the deal.
“As China’s leaders in world-class e-commerce, social media and big data, we could not ask for partners more ideally positioned to support Bitauto than JD.com and Tencent as we build out China’s leading platform for automotive e-commerce,” said William Bin Li, Chairman and Chief Executive Officer of Bitauto.
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Mr. Richard Liu, founder, Chairman and Chief Executive Officer of JD.com, commented, “This landmark deal will bolster Bitauto’s position as China’s leader in the auto e-commerce space, while providing JD.com customers an outstanding gateway to the car market.”
