Google is buying a $550 million stake in JD as part of a strategic partnership.
This partnership will benefit both companies, but I see JD as a big winner.
The move should help the Chinese giant’s international growth and margin expansion.
JD Will Benefit From Google’s Appetite for e-commerce
As a JD.com (NASDAQ:JD) investor and vocal bull here on Seeking Alpha, I can only welcome the recent partnership between the Chinese eCommerce giant and the king of the internet. Google (GOOG, GOOGL) is buying a $550 million stake in JD.com as part of a strategic partnership announced Monday with the goal of selling goods across Southeast Asia, North America and Europe. Google will receive more than 27 million newly issued JD.com Class A ordinary shares at an issue price of $20.29 per share, or $40.58 per American depository share, based on the volume-weighted average trading price over the prior 10 trading days.
According to the press release on JD’s website, Google and JD plan to collaborate on a range of strategic initiatives, including “joint development of retail solutions in a range of regions around the world, including Southeast Asia, the U.S. and Europe”. It’s clear from this line that the partnership is a strategic move with the goal of competing more effectively with players such as Amazon (NASDAQ:AMZN) and Alibaba (NYSE:BABA). JD and Google are the perfect partners in this venture, and the reasons are quite simple…