US retail giant Walmart is reportedly seeking to raise up to $3.74 billion by selling its stake in Chinese e-commerce company JD.com. Bloomberg reported on Tuesday, citing sources, that Walmart plans to sell 144.5 million shares of JD.com at a price ranging from $24.85 to $25.85 per share. Morgan Stanley is set to be the broker for this sale.
The news had an impact on JD.com’s stock, which is listed on the NASDAQ. On Tuesday, JD.com’s stock closed at $28.19 per share and dropped over 10% in after-hours trading, falling to $25.50 per share.
The collaboration between the two companies began in June 2016 when Walmart sold its Chinese online grocery store Yihaodian in exchange for a 4.97% stake in JD.com. Since then, Walmart has increased its stake in JD.com multiple times, with its ownership reaching 10.8% in October of the same year.
According to JD.com’s 2023 annual report, as of March 31 this year, JD.com founder Richard Liu holds a total of 11.2% of the company’s shares and 70.5% of the voting rights. Walmart owns 289 million Class A ordinary shares, accounting for 9.4% of the total shares and 3.1% of the voting rights.
Last Thursday, Walmart released its second-quarter financial results for the fiscal year 2025, which surpassed Wall Street analysts’ expectations for revenue and profit. Encouraged by the strong financial report, Walmart’s stock surged by 6.6% on that day. The company’s latest forecast predicts annual revenue growth between 3.75% and 4.75%, and adjusted earnings per share between $2.35 and $2.43.
This move by Walmart to sell its stake in JD.com reflects its strategic decision to raise funds and streamline its investment portfolio. JD.com, on the other hand, will need to navigate the impact of Walmart’s divestment on its shareholder structure and market performance. If the sale goes through successfully, it could pave the way for new opportunities and challenges for both companies in the competitive e-commerce landscape.