JD.com and L Catterton to Invest $175 Million in Secoo
The transaction offers Secoo a chance to collaborate with existing L Catterton porfolio companies and boost its recognition internationally.
BEIJING — JD.com and LVMH-backed private equity fund L Catterton Asia are to invest $175 million into Secoo, the largest online platform for upscale products in China, the three companies said Monday.
The investment will allow Secoo, which listed on the Nasdaq last September, to strengthen its leading position in the rapidly growing Chinese luxury e-commerce market, the companies said — and they hinted at more global ambitions.
“Through this partnership, Secoo will be able to leverage L Catterton and JD's operational expertise and vast resources to expand and deepen our market presence not only in China, but across the globe,” said Richard Li, chairman and chief executive officer of Secoo.
The company is the largest retailer in China of premium products online, with more than 300,000 stockkeeping units from more than 3,000 brands. Its high-end curation and customer set are something which much larger but more mass operators like JD.com and Alibaba-owned Tmall have also tried to create with platforms Toplife and Luxury Pavilion, respectively.
“We are thrilled to enter into a partnership with Secoo, the luxury e- commerce leader in China,” Ravi Thakran, chairman and managing partner of L Catterton Asia, said. “E- commerce continues to play an increasingly important role for consumers across all demographics, and as evidenced by our investment, we believe that Secoo is one of the strongest high- end platforms for the Chinese consumer. We look forward to working together with Richard and his outstanding team to take Secoo to the next level and continuously build out the platform for high- end consumers.”
The announcement detailed that the deal would provide Secoo an opportunity to collaborate with existing L Catterton porfolio companies, although did not mention if those brands might also begin retailing on JD.com's platforms as well. JD.com has been waging war with Alibaba over brand exclusivity, and has blamed what it says is its competitor's pressure tactics for the drop-off of a number of fashion brands from the JD platform, which has hurt its top line.