China's Wanda Group, Tencent team up for 'smart retail'
today May 30, 2018
Chinese real estate conglomerate Dalian Wanda Group will form a joint venture with technology giant Tencent Holdings and Groupon Inc's former local unit to integrate online and offline businesses, as the companies move towards "smart retail".
Wanda Group's Wanda Commercial Management Group and Tencent will take 51 percent and 42.48 percent, respectively, in the new company, Wanda said in a statement on Wednesday.
Gaopeng, U.S. daily deals company Groupon Inc's former affiliate in China and now backed by Tencent, will hold the remaining stake, Wanda said.
Wanda's existing internet business will be merged into the new company, while Tencent will provide online traffic, Wanda said. Gaopeng's electronics invoicing business will also be integrated into the venture.
The partnership will aim to transform Wanda's offline presence into smart shopping malls, and drive online traffic through Tencent's platforms including WeChat, Wanda said. The deal will also speed implementation of Tencent's smart retail strategy, it said.
Tencent and Alibaba Group Holding Ltd are already on an aggressive drive to boost their reach online and in brick-and-mortar stores, dividing the country's retail market into two camps.
The two tech behemoths, worth a combined $1 trillion (754 billion pounds), have spent more than $10 billion on retail-focused deals since the start of last year.
In January, a group led by Tencent made a 34 billion yuan (4 billion pounds) investment in Wanda's commercial property arm, easing Wanda's financial stress.
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