Jumei buys into BabyTree
Chinese online retailer of beauty products Jumei has stepped in to finance BabyTree to the tune of US$250 million.
The convertible loan and revolving credit will provide BabyTree with working capital with the loan convertible into a minority interest in BabyTree based on a pre-agreed formula.
The revolving credit facility is RMB806 million (US$130 million).
According to BabyTree, the site is the largest online parenting community in China, and is among the largest online parenting communities globally as ranked by traffic volume. Currently the more than 10 million people interact with BabyTree.com daily on its website or mobile apps BabyTree Pregnancy and BabyTree Footprints, which cover more than 80 per cent of pregnancy-stage parents and parents of children in China aged up to six years old.
The BabyTree Pregnancy app ranks number one among baby and maternity mobile apps in China.
Leo Ou Chen, founder and CEO of Jumei, said the deal with BabyTree will strengthen Jumei’s ability to create greater value in an important demographic.
“We believe this market has vast growth potential. Leveraging the enormous user base of BabyTree and Jumei’s supply chain and logistics expertise in cross border ecommerce, we are confident to become the dominant female eCommerce platform in China. We see significant cross-selling potentials across all Jumei product categories.”
Allen Huainan Wang, CEO of BabyTree, added: “The funds from this transaction will be used to develop BabyTree’s businesses, especially our eCommerce segment. Teaming up with Jumei will be a very beneficial partnership for us, and we believe it will allow BabyTree’s eCommerce business to rapidly grow to become number one in the baby and maternity sector. We believe the cooperation will help us bring about significant changes in the online retail industry of parenting products.”