JD.com widens Southeast Asia presence by investing in Vietnam’s Tiki.vn

BEIJING: Chinese online retailer JD.com Inc has made an investment in Vietnamese e-commerce firm Tiki.vn, expanding its Southeast Asia business amid growing competition in the region from Alibaba Group Holding Ltd and Amazon.com Inc. JD.com co-led the financing with Vietnamese entertainment and social media firm VNG Corp, which is an existing investor, China´s second-biggest e-commerce firm behind Alibaba said in a statement on Tuesday.

The firm did not disclose the size of the funding but said that JD.com will become one of Tiki´s largest shareholders alongside VNG following the deal. Vietnamese media had reported in November that the round was worth roughly 1 trillion dong ($44.04 million). JD.com declined to give a dollar number for the investment, when contacted by Reuters.

"With JD´s expertise in leveraging social media for e-commerce, Tiki.vn´s partnership with VNG in social network and mobile payments is a natural fit," Winston Cheng, president of JD.com´s international business, said in the statement.

Vietnam is the latest focal point in JD.com´s strategic push into Southeast Asia, where Alibaba and Amazon have also made significant investments in the past year.

JD.com will tap Tiki.vn´s warehousing and delivery system, as well as its technology and payments capabilities. Tiki.vn and VNG´s tie-up has similarities to the partnership between JD.com Inc and internet giant Tencent Holdings Ltd , which is an investor in JD.com and Asia´s largest tech firm by market cap.

JD.com leverages data and payments from Tencent´s WeChat, China´s most popular social media app, and will seek to build similar capabilities with VNG and Tiki.vn, Cheng told Reuters.

While Southeast Asia´s e-commerce market is still nascent compared to the China´s, improvement in internet services and an increase in mobile-based payments have attracted large international e-commerce firms to the region.

Alibaba has invested heavily in payment and e-commerce ventures in Thailand, Singapore, Indonesia and Malaysia.

U.S. retailer Amazon also launched its subscription-based Prime service in Singapore last month in a bid to challenge Alibaba-backed online retailer Lazada Group in Southeast Asia.