Wal-Mart Stores Inc., has announced that it will increase its investment in the holding company of Yihaodian, Chinese eCommerce company, in an effort to strengthen its online presence.
The agreement will bring Walmart's total ownership stake to approximately 51 percent. The closing of the deal is subject to regulatory approval by the Chinese government.
This investment further enables Walmart to deliver a superb customer experience to Chinese consumers that are already connected to the world through smart phones and social media. We are on track to create the next generation of eCommerce, offering the latest in online innovations to give our customers a unique shopping experience, Neil Ashe, President and CEO of Walmart Global eCommerce, said in a statement.
Launched in 2008, Yihaodian offers over 180,000 products from computers and electronics to groceries. Yihaodian is one of the fastest growing companies in China, and has earned first place for Deloitte Technology Fast500 Asia Pacific and first place for China Entrepreneur Magazine's Future Stars of China Enterprises in 2011. Wal-Mart made its initial strategic investment in Yihaodian, acquiring a 20 percent minority stake in the company for about $65 million in May 2011.
Yihaodian is expecting the deal to enable it to improve customer experience and operational efficiency by using Wal-Mart's excellence in supply chain. Gang Yu, co-founder and chairman of Yihaodian, said: Walmart not only brings us nearly 50 years of retailing experience and history, but also innovative technology and eCommerce solutions that will help us better meet our customers' needs.” Yihaodian also expects that Walmart will share its knowledge and technology together with its best-in-class practices in retail and transfer them to its existing organization.
As of 2010, Wal-Mart, which made its first venture into the Chinese market by opening its first store there in 1996, had 189 stores in 101 cities throughout China.