BEIJING, July 6 (Reuters) - Shares in China's Suning.com
jumped by a maximum 10% on Tuesday after the
loss-making online retailer announced a restructuring plan that
will see a state-backed fund become a major shareholder, easing
investors' liquidity concerns.
Suning.com's chairman and biggest shareholder, Zhang
Jindong, along with several other major shareholders, will sell
a combined 17% stake to a local government-led fund that counts
Alibaba Group and Xiaomi as investors,
according to an exchange filing.
The 8.8 billion yuan ($1.36 billion) deal, which the company
said will leave it without a controlling shareholder, comes amid
concerns over cash flow at Suning.com and its parent company,
Suning.com, which forecast a net loss of up to 3.2 billion
yuan in the first half, needs to repay 15.8 billion worth of
bonds this year.
The company's shares dropped to a decade low on June 15 when
trading was halted pending announcement of a restructuring. The
stock jumped the maximum 10% after trading resumed on Tuesday.
Suning.com said on Tuesday that the new fund, led by the
government of Jiangsu Province and the city of Nanjing, will
actively support its stable and healthy development. It said the
local governments will provide emergency credit support as
Alibaba, which already owns roughly 20% of Suning.com
through its Taobao unit, is an investor in the fund, as are
major electronics makers Haier, Midea,
TCL and Xiaomi.
($1 = 6.4595 Chinese yuan renminbi)
(Reporting by Samuel Shen in Shanghai, Sophie Yu and Tony
Munroe in Beijing; Editing by Shailesh Kuber)