Suning.com, one of China’s largest retailers said that Yunwang Wandian, its eCommerce and online retail arm has secured 6 billion yuan (approx. US$912.3 million) in a Series A financing round as the business is looking to consolidate and build leverage on both the company’s online and offline resources.
The new financing will give the retail arm access to strategic resources and strong financial support, which can help it expand client acquisition, increase investment in research and developmental projects, as well as enhance the platform operations capability, and improve service quality.
Based on a filing disclosed to the Shenzhen stock exchange on December 1, the round was based on a pre-money valuation of 25 billion yuan (approx. US$3.8 billion) and led by Chinese government-guided investment firm Shenzhen Capital Group.
Yunwang Wandian entered into the fundraising agreement with a group of domestic institutional firms including a Chinese state-owned vehicle backed by Southern China’s Luohu Government, a fund managed by Beijing-based Fengyun Capital, and SenseRobot Management.
V Star Capital, Central China International Asset Management, the asset management unit of Hong Kong-based Central China International, and global investment firm Softfir Capital among others, also participated in the fundraising. Following the deal, Yunwang Wandian will remain a majority-owned subsidiary of Suning.com.
With a 30-year legacy of commitment to exceptional customer service, Suning has evolved its offering over the years to meet the changing demands of consumers.
Starting as a traditional retailer, Suning.com found its roots as an air conditioning specialty store before quickly evolving into a chain retailer, then entered the eCommerce space, before finally entering its fourth decade of operations as a retail service provider.
The Nanjing-based retailer set up Yunwang Wandian, which translates to bridging tens of thousands of shops, in November 2020 to take care of Suning.com’s internet platform business.
Yunwang Wandian will use its parent’s information technology infrastructure while Suning.com’s supply chain and logistics unit will provide services to the new subsidiary.
The unit serves to provide individuals, dealers, suppliers, and merchants with e-commerce and internet retail solutions covering supply chain, logistics, aftersales, and everything in between. It is set up to help both brands and retailers shift into digital technology and eCommerce, and provides an ecosystem that consists of large-scale distribution and connectivity.
Suning.com expects the development of the venture to bring efficiency in scaling advancements and is heavily invested in areas of the supply chain, logistics, and IT infrastructure.
“The firm’s 30-year development itself represents the history of the Chinese retail industry,” said Lou Yang, the vice president of Chinese investment bank Lighthouse Capital.
He added that the birth of Yunwang Wandian represents Suning.com’s efforts to build an integrated, comprehensive retail platform that can empower small businesses with customizing online retail solutions.
Suning.com has posted a revenue of 62.4 billion yuan (approx. US$9.5 billion) in the third quarter of 2020, which is down 4.58 percent compared to the same period in 2019. Its net profit attributable to shareholders stood at 713.7 million yuan (approx. US$108.6)