(Bloomberg) — China’s major home appliance makers Haier Group Co. and Xiaomi Inc. are among investors considering joining Alibaba Group Holding Ltd. in a mega bailout of cash-strapped Suning.com Co., according to people familiar with the matter.
Midea Group Co., TCL Technology Group Corp. and Yuyue Group are also weighing to buy a stake in the retail arm of Chinese billionaire Zhang Jindong’s Suning empire, said the people, who asked not to be identified as the information is private. They could be joining Alibaba and the government of China’s eastern Jiangsu province, which are nearing a deal for an interest in Suning.com, Bloomberg News reported earlier this week.
Negotiations are still ongoing and could be delayed or fall apart, they added. A representative for Xiaomi declined to comment, while representatives for Suning, Haier, Midea, TCL and Yuyue didn’t immediately respond to requests for comment.
Suning.com, one of China’s biggest retailers of appliances, electronics and other consumer goods, had a market value of about 52 billion yuan ($8 billion) before trading was halt on June 16. It’s been in trouble for some time: the retail business was weakened by the initial slowdown in spending during the pandemic, and concerns about its cash flow intensified in September, when Zhang waived his right to a 20 billion yuan payment from China Evergrande Group, the world’s most indebted property developer.
The stock tumbled to a nearly eight-year low in Shenzhen in June after a Beijing court froze 3 billion yuan worth of shares held by Zhang — representing 5.8% of Suning.com, and as creditors agreed to extend a bond for Suning Appliance Group Co., which is owned by Zhang and fellow co-founder Bu Yang.
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