JD.com To Acquire 33% Stake In Insurer Allianz China To Beef Up Financial Services


JD.com Inc., China’s second-biggest e-commerce company, will invest RMB537 million (US$85 million) in Allianz China General Insurance, taking a 33% stake and becoming its second largest shareholder, according to the announcement published by the Insurance Association of China.

Shenzhen Huijing Tongda Business Consulting Co., Ltd. and Zhongyuan Xinda Intellectual Property Agency Co., Ltd. also participated in the round.

Following the acquisition, the registered capital of previously wholly-owned Allianz will increase to RMB1.61 billion from the current RMB805 million. Allianz Insurance Group, funded by German financial services firm Allianz SE, will retain 50% of the shares.

The transaction still requires approval by the China Banking Regulatory Commission, according to an announcement by Allianz.

The two companies have also reached a long-term cooperation deal and plan to build a digital insurance joint venture to meet the rapidly evolving needs of Chinese consumers.

In 2016,there were about 330 million online insurance customers in China, an increase of more than 40% from the year before, according to Ant Financial and CNBData. Growing demands for technology-driven solutions is expected to push insurers to further enhance their digital capabilities.

Other Chinese Internet firms, such as top e-commerce rival Alibaba Group and tech giant Tencent Holdings, are also investing heavily in the country’s burgeoning online finance sector.

JD.com, China’s second-biggest e-commerce company, spun out its finance unit as JD Finance in 2017, offering financial products and services, including wealth management, credit services, payment solutions and crowdfunding.

Chinese investment banking firm China International Capital Corporation Limited (CICC) and China National Cereals, Oils and Foodstuffs Corporation (COFCO) agreed to inject US$1.9 billion in JD Finance in March this year.

 

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