Suning Holdings Group Pledges All Its Shares to Alibaba- PingWest

Suning Holdings Group Pledges All Its Shares to Alibaba- PingWest

Suning Holdings Group Pledges All Its Shares to Alibaba

December 11, 2020 5:25 am

Beijing (PingWest)—Suning Holdings Group shareholders Zhang Jindong, Steven Zhang, and the Nanjing Runxian Enterprise Management Center have pledged all the group shares to Alibaba's online shopping platform Taobao, according to National Enterprise Credit Information Publicity System.

The pledged equity is worth 1 billion yuan ($152.78 million), which is equivalent to the registered capital of Suning Holdings Group. Zhang Jindong, the Group's founder, also pledged 65,000 shares of Suning Real Estate to Taobao.

Founded in 1990, Suning Holdings Group has two listed subsidiaries at home and abroad and more than 280,000 employees around the world, ranking the third in the Chinese private sector. Its business scope covering three main sectors: Retail, Real Estate, and Financial Service. The company is well-known to consumers for selling home appliances in brick-and-mortar stores, and it has been working hard to boost the e-commerce business Suning.com over the years.

The two parties have a close relationship. In 2015, Alibaba announced that it spent 28.3 billion yuan for newly issued Suning shares and held a 19.99% take. In turn, Suning invested 14 billion yuan in acquiring 1.1% of Alibaba through the purchase of new shares. The alliance would allow Alibaba's online customers to go into one of Suning's 1,600 outlets in China to try out a product before purchasing it on Alibaba's website using their smartphone.

Regarding the equity pledge, Suning said it was commercial cooperation and would not affect Suning.com's strategic development and regular operations.

Suning's debt-to-asset ratio stood at 73.8% at the end of June, little changed from 73.76% at the end of last year, according to an interim financial report shared with investors. Its interest coverage ratio, a measure of debt-servicing capacity, dropped to 0.76 from 1.61 a year earlier.

Suning Holdings Group acquired a majority stake in top European soccer club Inter Millan for a reported €270 million ($327.89 million) back in June 2016. Steven Zhang, son of Zhang Jidong, was appointed as the chairman of the club in 2018. Compared with last year, the Italian giant saw their revenues fell by €45 million ($53.9 million) to €372.4 million ($446.4 million) for the 2019/20 financial year.

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