JD.com Inc (JD) will invest HK$1.3 billion ($171 million) in Hong Kong-listed Kingdee International Software Group Co Ltd in an attempt to form a strategic partnership, the two companies jointly announced on Monday.
JD, one of China's biggest e-commerce companies, will purchase 10 percent of Kingdee's shares in cash as the two companies enter a partnership agreement to provide small and medium-sized enterprises (SME) integrated Enterprise Resource Planning (ERP) solutions through a cloud service, according to an announcement published on jd.com on Monday.
The cloud service will help JD integrate the company's e-commerce and logistics system with Kingdee's ERP solutions, "and migrate an integrated package to an enterprise cloud solution in a bid to better serve the growing demand in China's enterprise solutions market," Liu Qiangdong, CEO of JD, was quoted as saying in the announcement.
Like its major rival Alibaba Group Holdings, JD is planning to serve a growing number of SMEs, which requires the online sales company to provide more enterprise services, said Wang Xiaoxing, an analyst from Beijing-based market research firm Analysys International.
"Kingdee has a large SME customer base in China and overseas, which is attractive to JD," Wang noted.
JD launched its global trade platform JD Worldwide in April that enables Chinese customers to order goods from hundreds of brands and sellers in oversea markets such as Australia, France and Germany, according to an announcement published on JD's website in April.
Shenzhen-based software company Kingdee reached an agreement with U.S. e-commerce giant Amazon to strengthen their cooperation in ERP cloud service on April 23, according to an announcement published on the website of the Hong Kong stock exchange.
The cooperation is expected to help the software company improve its ERP cloud service and establish a cloud computing ecological system in the Chinese mainland.
JD also teamed up with Shanghai Pharmaceuticals Holding Co Ltd on Monday to develop its online healthcare services, according to Shanghai Pharma's filing.
