Wanda Group, the big China real estate developer led by billionaire Wang Jianlin, has continued to reduce its non-core business by selling a department store chain to Suning.com for an undisclosed amount.
Suning, one of China’s largest online and offline retailers, said in a press release today it will take over 37 department stores with a membership of four million consumers.
The agreement is the second since the beginning of last year involving Wang and Suning, itself led by high-powered China billionaire Zhang Jindong. Wanda Commercial, Wang’s main real estate company, in early 2018 said a 14% stake in the business has been sold for $5.4 billion to investors that included Suning, as well as Internet heavyweights Tencent and JD.com, and real estate developer Sunac. It didn’t disclose the sellers.
Suning’s latest move underscores the quickening online-to-offline integration of retailing at a time of slowing economic growth in the world’s No. 2 economy. Alibaba Group, the country’s largest e-commerce company, in recent years acquired the Intime Department Store chain, and is currently expanding in the fresh grocery business through a self-run chain, Hema. Tencent last year bought a stake in grocery chain Yonghui Superstores, which is also partly owned by JD.com.
Wanda, one of the world’s largest real estate developers, hasn’t found much success in e-commerce, and the sale of its department stores will potentially allow the Beijing-headquartered company to focus elsewhere.
Wanda may also be able to use the receipts to pare down debt. Once one of China’s most active international investors, Wanda has in the past two years sold off real estate and entertainment industry assets to businesses that also include Guangzhou R&F, led by billionaire Zhang Li. Wang notably last year lowered his stake in U.S. movie theatre chain AMC.
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