Thailand’s largest retail conglomerate Central Group has teamed up with China’s largest retailer JD.com and Provident Capital to establish two joint ventures in Thailand with an aggregate investment of up to $500 million.
Under the agreement, half of the investment will come from Central Group and the remainder from JD.com, its finance arm JD Finance and Provident Capital, which is also JD.com’s strategic partner for its Indonesian e-commerce business.
One of the joint venture firms will cover e-commerce services and the other will be a fintech company, according to the company’s announcement on Friday.
The partnership will leverage Central Group’s retail resources including its physical store network, which will serve as key omni-channel and payment locations, its brand and merchant relationships, as well as the retail behaviour insights from its loyalty programme.
“Thailand’s mobile-driven population, with its increasing consumer spending power, means that e-commerce is ready to explode, and this partnership is poised to capture the country’s consumers as they migrate online. This move has marked a key step with Central Group’s goal to become Thailand’s online retail leader,” said Tos Chirathivat, chief executive officer of Central Group.
It will open multiple flagship stores of its omni-channel businesses on the JV e-commerce platform for its department stores and key retail chains and for selected brands owned or operated by Central Group.
On the other side, JD.com will provide its extensive expertise in technology, e-commerce and logistics to the e-commerce JV, it will transfer its financial know-how technology in developing markets with artificial intelligence and cloud computing for the fintech JV.
“Thailand’s large population and developed infrastructure, including strong national logistics networks, give it tremendous potential for both e-commerce and fintech services, said Richard Liu, chairman and CEO of JD.com.
He added that cooperation with Central Group will provide JD.com competitive advantage when the company expands further into Southeast Asia.