JD.com Inc’s logistics unit is considering an initial public offering (IPO) that could raise at least $5 billion, according to a person familiar with the matter.
JD Logistics is targeting a valuation of about $40 billion, the person said, asking not to be identified as the information is not public. The company is leaning towards choosing Hong Kong as a venue for the IPO, the person said. JD has held early discussions with banks, said people familiar with the matter.
The IPO plans are still preliminary, the people said. The company could decide not to proceed with a listing and details including size and venue could still change, they said. The potential listing was first reported by IFR.
A representative for JD did not immediately respond to requests for comment.
China’s No. 2 e-commerce giant JD spun off its logistics arm into a separate entity in 2017. JD Logistics operated more than 800 warehouses across China as of September 30, according to JD’s most recent earnings. JD reported net revenue from new businesses, which includes the logistics unit, of about 11 billion yuan ($1.7 billion) during the September quarter. The figure represents roughly 6% of JD’s total revenue.
JD is currently seeking to list its health care unit in Hong Kong in an IPO that would raise about $3 billion, Bloomberg News has reported.
JD Digits, its fintech affiliate, filed an IPO prospectus in September with the Shanghai Star Market, though it is unclear how changes to micro-lending rules will affect the unit’s listing plan.
The e-commerce company also raised $4.46 billion in a second listing in Hong Kong earlier this year.