SHANGHAI (Reuters) – Wal-Mart Stores Inc has taken full ownership of Chinese e-commerce firm Yihaodian.com, buying out the 49 percent stake that it did not already own to accelerate its push online, the U.S. retail giant said on Thursday.
The investment will assist Wal-Mart target China's fast-growing online market at a time when largely brick & mortar retailers are feeling the pinch of competition from online rivals & a slowing of the world's second-largest economy.
Wal-Mart's move moreover comes after China said last month it will allow full foreign ownership of some e-commerce businesses, with the goal of encouraging foreign investment & the development & competitiveness of the sector.
p> "[Yihaodian's] local experience, combined with Walmart's global sourcing & our strong local retail presence & supply chain will allow us to deliver low prices on the products customers need in new & thrilling ways," Neil Ashe, head of Wal-Mart's e-commerce division, said in a statement.
Wal-Mart, the world's largest retailer, added the purchase of the stake would assist accelerate its e-commerce business in China & boost coordination between its physical & online stores. It did not disclose the price paid for the stake, which was bought from former executives & financial services group Ping An.
Wal-Mart's Asia head Scott Price told Reuters earlier this year that online retail was significant to assist tap China's younger generations & that the firm would increasingly look to weave together its online & offline presence in the market.
Wal-Mart, France's Carrefour SA & Britain's Tesco PLC have all seen sales growth slip over the last five years in China, losing market share to local rivals, according to consumer analytics firm Kantar Worldpanel.
The U.S. retailer moreover announced on Thursday that company insider Wang Lu will take the helm at Yihaodian. The e-commerce firm's CEO & Chairman had quit earlier this month "to pursue their next venture".
In 2012, Wal-Mart took control of Yihaodian by bumping up its stake to 51 percent. Yihaodian, though, is dwarfed in China by e-commerce leaders Alibaba Group Holding Ltd & JD.com Inc.
(Reporting by Adam Jourdan; Editing by Muralikumar Anantharaman)
Board & Management ChangesWal-Mart Stores Inc