China's JD.Com Moves To Follow Alibaba With Hong Kong Listing
March 16 2020 - 5:46AM
Dow Jones News
By Joanne Chiu
Chinese e-commerce group JD.com Inc. is considering following
larger rival Alibaba Group Holding Ltd. in a market debut in Hong
Kong.
Securing this deal despite market turmoil would be a victory for
the Hong Kong stock exchange, which is eager to become a major
venue for Chinese technology stocks.
In November, Alibaba completed a secondary listing in the city,
which eventually raised about $13 billion including a so-called
overallotment option.
Bankers and investors had expected more U.S. listed-Chinese
companies to do the same. Other major Chinese tech groups with New
York-traded shares include search engine-operator Baidu, online
travel specialist Trip.com, and NetEase, China's second-biggest
gaming firm.
JD.com has hired Bank of America and UBS Group AG for help
arranging a secondary listing in Hong Kong, people familiar with
the situation said. The likely timetable or size of any fundraising
couldn't be learned. The banks' engagement was earlier reported by
Hong Kong Economic Journal.
The two investment banks have a long working relationship with
the company, underwriting its 2014 initial public offering on the
Nasdaq.
For JD.com, a Hong Kong listing would allow it to get closer to
its home market and investors who have a better understanding of
its business model, one of the people said.
JD.com shares have more than doubled from the offering price of
$19 each. It has a $58 billion market capitalization, making it the
largest U.S.-listed Chinese tech company after Alibaba.
Earlier this month, JD.com said it expected net first-quarter
sales would grow at least 10% compared with a year earlier. Net
revenue in the previous quarter beat analysts' expectations, rising
26.6% to 170.7 billion yuan ($24.4 billion). The company said that
was thanks to strong sales on Singles Day, an annual Chinese
shopping bonanza similar to Black Friday, and to robust user
growth.
In April last year, a college student filed a civil lawsuit
against JD.com founder and Chief Executive Liu Qiangdong, also
known as Richard Liu. In 2018, she had accused him of rape but
prosecutors declined to charge him.
Write to Joanne Chiu at joanne.chiu@wsj.com
(END) Dow Jones Newswires
March 16, 2020 05:31 ET (09:31 GMT)
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