JD.com's Ceconomy Concessions Draw Rival Criticism, EU Decision Due Oct 23
JD is trading near its 52-week low of $24.508 (10% above the low) on light trading volume (0.3× avg).
Summary
JD.com's proposed remedies to address EU subsidy concerns over its $2.5B Ceconomy acquisition have met with criticism from competitors, according to Reuters sources. The European Commission informed JD.com earlier this week of the negative feedback on concessions offered last month, which included giving Ceconomy access to JD.com's European logistics and technology at market rates and smaller rivals access at fair and non-discriminatory rates. This follows the EU's July formal charges over unfair subsidies and a preliminary review in May that flagged preferential financing, tax incentives, and grants possibly attributable to Beijing. The Commission will decide on the deal by October 23, and the criticism puts pressure on JD.com to improve its concessions. The outcome will determine whether JD.com can complete its expansion into European electronics retail or faces a blocked deal.
At the time of this announcement, JD was trading at $26.98 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $32.7B. The 52-week trading range was $24.51 to $36.86. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Reuters.