May 31, 2024 04:37 PM
BUSINESS
Suning to Get $66 Million Lifeline From Citic
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What’s new: China’s money-losing retail giant Suning.com Co. Ltd. is getting a financial lifeline of up to 480 million yuan ($66.2 million) from a state-owned asset manager to develop its retail cloud business.
The Jiangsu province branch of China Citic Financial Asset Management Co. Ltd. will provide a loan to Nanjing Suningjia E-Commerce Co. Ltd., Suning.com said in a stock exchange filing dated Thursday.
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- Suning.com received a financial lifeline of up to 480 million yuan ($66.2 million) from Citic Financial Asset Management to support its retail cloud business.
- In 2023, Suning.com reported a net loss of nearly 4.1 billion yuan, improved from 16.2 billion yuan in 2022, with a liability-to-asset ratio rising to 91.67%.
- Suningjia, founded in 2017, offers cloud services via a franchise model and had 10,756 outlets as of March 31.
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Who’s Who
- Suning.com Co. Ltd.
- Suning.com Co. Ltd., a struggling retail giant based in Nanjing, Jiangsu province, has faced escalating debt since 2020 due to a borrowing-fueled acquisition spree. Despite significant losses, the company continues to invest in various sectors. In 2023, it reported a net loss of nearly 4.1 billion yuan, narrowing from about 16.2 billion yuan in 2022. The company's liability-to-asset ratio stood at 91.67% at the end of 2023.
- Nanjing Suningjia E-Commerce Co. Ltd.
- Nanjing Suningjia E-Commerce Co. Ltd., founded in 2017, offers cloud services to merchants on Suning.com’s platforms in lower-tier cities via a franchise model. By March 31, it operated 10,756 franchise outlets. The company will receive a loan from China Citic Financial Asset Management's Jiangsu branch to enhance its retail cloud business, optimize its supply chain and improve franchisee operations.
- China Citic Financial Asset Management Co. Ltd.
- China Citic Financial Asset Management Co. Ltd. is a state-owned asset manager that was created after Citic Group led a bailout of the former China Huarong Asset Management Corp. in 2021. The Jiangsu province branch of this firm is providing a financial lifeline of up to 480 million yuan ($66.2 million) to Nanjing Suningjia E-Commerce Co. Ltd. to support its retail cloud business development.
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What Happened When
- 2020：
- Suning.com faced an escalating debt crisis following a borrowing-fueled acquisition spree.
- 2021：
- China Citic Group led a bailout of the bad-debt manager, transforming it into Citic Financial Asset Management.
- 2022：
- Suning.com reported a net loss of about 16.2 billion yuan.
- 2023：
- Suning.com reported a net loss of nearly 4.1 billion yuan, narrowing from the previous year's loss.
- By the end of 2023：
- Suning.com had a liability-to-asset ratio of 91.67%, compared with 89.22% a year earlier.
- As of March 31, 2024：
- Suningjia had 10,756 franchise outlets.
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