Published: Tue, June 19, 2018
Money | By Armando Alvarado

Google announces strategic partnership with Chinese online retailer JD.com

Google announces strategic partnership with Chinese online retailer JD.com

This move is expected to help JD.com to expand beyond its base in China and Southeast Asia in order to establish a meaningful presence in US and European markets.

Google has formed a strategic partnership with Chinese e-commerce company JD.com which will see the search giant invest $550m in cash as the companies develop "next generation" retail services.

JD.com is China's second-largest e-commerce company after Alibaba.

"This partnership with Google opens up a broad range of possibilities to offer a superior retail experience to consumers throughout the world", JD.com's chief strategy officer Jianwen Liao said. This could help JD.com expand beyond its base in China and Southeast Asia and establish a meaningful presence in US and European markets. But the deal will also allow Google to draw people away from Amazon when doing product searches online, boosting their advertising dollars.

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For Google's contribution, Alphabet will receive 27.1 million shares of newly issued stock. Japan's SoftBank Group Corp, which is making big internet investments around the globe, is a major investor in Alibaba.

This includes improving supply chain and logistics operations for Google in the region, and JD.com benefiting from Google's technological expertise, the two companies said in a statement.

The deal will also see JD.com products appear on Google Shopping in the United States and Europe.

Although Google is blocked in JD's homeland and main market, China, the partnership recognizes the technical prowess of the USA tech giant and hopes to merge it with JD's supply chain and logistics skills and scale.

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