JD.com, founded by Chinese billionaire Richard Liu Qiangdong in 1998, is considering a bid for UK electronics retailer Currys as China’s e-commerce giants continue to look for overseas growth amid stagnant demand and rising competition at home.
JD said on Monday it is “in the very preliminary stages of evaluating a possible transaction that may include a cash offer for the entire issued share capital of Currys”. The UK retailer, which operates 823 stores globally with 28,000 staff, rejected a US$883 million bid from US investment firm Elliott at the weekend.
Currys, which formerly operated the Dixons and Carphone Warehouse brands in Britain before focusing on the Currys name, has struggled to grow profits in recent years as consumer spending has been squeezed by the pandemic, inflationary pressures and higher interest rates.
Beijing-based JD began life as an online white goods merchant and electronics remains a key area for the company. JD said in its statement that there is “no certainty that any offer will ultimately be made”.
JD.com founder warns staff not to ‘lie flat’, as rival PDD shines
JD.com founder warns staff not to ‘lie flat’, as rival PDD shines
Under UK takeover rules, Elliot – which already owns Waterstones bookshops in the UK – has until 5pm on March 16 to make a renewed offer for Currys or announce it is walking away.
Li Chengdong, founder and analyst at e-commerce consultancy Dolphin, said an acquisition of Currys by JD would allow the Chinese firm to “step up its branding and sales channels” in overseas markets.
If a deal transpires, it would mark a resumption of JD’s efforts to expand overseas after its withdrawal from Southeast Asian markets Indonesia and Thailand in early 2023, seen as a setback by analysts.
Amid rising competition at home from short-video platforms such as ByteDance’s Douyin, JD founder Liu has hit out at the e-commerce firm’s recent management and performance, calling for people to step up before there is “no way out”.
The takeover bid fits a template for JD, after it acquired domestic electronics chain Five Star Appliance in 2020 to explore the integration of online and offline sales.
Currys operates about 300 stores with 15,000 staff in the UK, and also has significant operations in Ireland and Nordic markets.
