U.S. retailer store Walmart plans to expand its operation in China and takes ownership of e-grocer Yihaodian. (Photo : www.asiabizz.com)
U.S.-based retailer Walmart Stores Inc. has taken full ownership of Yihaodian, a fast-growing Chinese e-commerce enterprise, after acquiring the 49 percent of the company shares that it did not already own, according to a press release sent by Walmart on Thursday, July 23, to the Global Times.
Walmart had previously invested in Yihaodian, a business-to-consumer e-commerce website that specializes in grocery products, in 2011 and raised its stake to 51.3 percent to gain majority control in 2012.
The report said that having full ownership of the Chinese e-commerce company will enable Walmart to offer customers its experience in managing the online, mobile and physical stores.
Walmart said that they have already allowed customers to purchase products online via mobile devices and pick up their orders in stores or have them delivered.
An Yuan, a public relations employee at Walmart China, told the Global Times that Walmart can provide shoppers and Yihaodian's 100 million users with more choices at lower prices via the online platform of Yihaodian.
The report said that Walmart's move is in line with China's policy of encouraging foreign investment in e-commerce, as the Ministry of Industry and Information Technology has approved in June the full foreign ownership of certain e-commerce businesses.
According to a report released earlier this month by domestic industry information provider cnii.com.cn, it is important for Walmart to explore China's online market as e-commerce transactions grew 21.3 percent in 2014 to 12.3 trillion yuan ($1.98 trillion), surpassing the U.S. as the world's largest online retail market.
Walmart's major rival, Carrefour SA, has also ventured into the promising e-commerce sector in China, opening its own online shopping mall in June, a PR representative of Carrefour told the Global Times Thursday.
Walmart's online service is currently limited to Shanghai residents, but the company plans more moves in this sector.
The statement said that Walmart bought the remaining shares from Ping An of China, a financial services group, and two co-founders of Yihaodian--former Chairman Yu Gang and former CEO Liu Junling--who resigned earlier this month "to pursue their next ventures." The two executives, however, will continue to serve as strategic executive advisors of Yihaodian to facilitate the company's transition.
