Tencent and JD.com lead $863mn investment in online retailer Vipshop

Chinese internet giant Tencent Holdings Ltd is leasing an $863mn investment in online apparel platform Vipshop Holdings Ltd. It is joined in the investment by e-commerce company JD.com.

Tencent will pay $604mn for a 7% stake, while JD will up its current 2.5% stake to 5.5% with an investment of $259mn.

Tencent’s president Martin Lau said that the deal would bring Vipshop Tencent’s “audiences, marketing solutions and payment support”.

See also:

Tencent valued at over $500bn

China’s National AI Team: Baidu, Tencent, Alibaba and iFlyTek

Tencent’s China Literature issues biggest-ever Hong Kong tech IPO

JD’s Chief Executive Richard Lui said that the move would help “expand the breadth and reach of our fashion business”.

Tencent will use its WeChat messenger service and online payment systems to drive demand for its new push into retail, where it intends to rival Alibaba. WeChat currently has just under a billion users and Tencent as a whole is the most valuable company in Asia with a market capitalisation of $473mn.

So far Alibaba have been competing for business in areas like bike-sharing, food delivery and gaming. Alibaba is now focussing on adding to its offline offerings, having invested around $10bn in brick-and-mortar businesses while Tencent recently invested $636mn in a 5% stake in supermarket company Yonghui Superstores Co Ltd.