Hillhouse Capital Management, managed by Lei Zhang, has reduced its passive stake in JD.Com Inc (ADR) (NASDAQ:JD), which is an online direct sales company in China. In its latest filing with the U.S. Securities and Exchange Commission, Hillhouse Capital disclosed that its ownership of the company’s shares reduced to nearly 305 million Class A ordinary shares from around 310 million shares the fund held previously. The new stake is equal to 13.8% of the company’s ordinary shares.
Yale University-backed Hillhouse Capital Management was founded in 2005 by Zhang Lei, who is one of the top dogs in Asia. Hillhouse Capital focuses media, consumer, industrial and commodity-related sectors. Some of the fund’s investment decisions would classify it as a contrarian, though it maintains its fair share of mainstream bets as well. Hillhous Capital has offices in Beijing, Hong Kong and Singapore. As of the end of the third quarter of 2014, the value of the Hillhouse Capital’s equity portfolio totaled nearly $816 million, down from the previous value of more than $880 million.
Hillhouse Capital reported holding largest stakes in Mondelez International Inc (NASDAQ:MDLZ), Ctrip.com International Ltd. (ADR) (NASDAQ:CTRP), Sohu.com Inc (NASDAQ:SOHU). The fund held 9.30 million shares of Mondelez International Inc (NASDAQ:MDLZ), which manufactures food and beverage products for consumers in over 100 countries worldwide. Ctrip.com International Ltd. (ADR) (NASDAQ:CTRP) was the most valuable holding, in which the fund reported ownership of 3.76 million shares. Hillhouse Capital owned 1.65 million shares of Sohu.com Inc (NASDAQ:SOHU), as of the end of the third quarter. The fund’s stakes in these three holdings remained unchanged over the quarter. Hillhouse Capital reported owning 154,850 shares of Baidu Inc (ADR)(NASDAQ:BIDU), as of the end of the third quarter.
Last month, Hillhouse Capital revealed raising its activist stake in Qunar Cayman Islands Ltd (NASDAQ:QUNR), owning around 17.03 million class B shares of the company, the stake represents 14.84% of class.
JD.Com Inc (ADR) (NASDAQ:JD) is an online direct sales company, located in Beijing, China. The company boosted its net revenues by more than 50% to nearly $4.7 billion in the third quarter of 2014. The company reported more nearly 60% increase in its online direct sales. Last year, JD.Com Inc (ADR) (NASDAQ:JD) became the first e-commerce company in China to leverage high-speed rail for shipping. As of September 30, 2014, the company operated 118 warehouses with an aggregate gross floor area of approximately 2.3 million square meters.
JD.Com Inc (ADR) (NASDAQ:JD) stock has also been performing since January 2014. The stock’s 1-year performance stands at 15.91%, and its year-to-date performance at 4.69%. Currently, the stock is trading around $24. Analysts set the average target price of the stock at $32.07, while the average recommendation is ‘Overweight’ for the stock. JD.Com Inc (ADR)(NASDAQ:JD) has a market cap of over $33 billion.
Last week, JD.Com Inc (ADR) (NASDAQ:JD) announced a strategic partnership with Bitauto Hldg Ltd (ADR) (NYSE:BITA) and Tencent Holdings Limited to develop the leading automotive e-commerce platform in China. JD.Com Inc (ADR) (NASDAQ:JD) and Tencent Holdings agreed to invest US$1.3 billion in Bitauto Hldg Ltd (ADR) (NYSE:BITA), and US$250 million in cash in YiXin Capital Limited, a subsidiary of Bitauto Hldg Ltd (ADR) (NYSE:BITA) primarily engaged in e-commerce-related automotive financing platform business. The three companies plan to work together to provide enhanced online automotive transaction services to car buyers across China. The deal is expected to close in the first half of 2015, subject to customary closing conditions.
Following the completion of the transactions, JD.Com Inc (ADR) (NASDAQ:JD) and Tencent Holdings Limited will hold 25% and 3.3% of the Bitauto Hldg Ltd (ADR) (NYSE:BITA)’s outstanding shares on a fully diluted basis, respectively. In addition, and JD.Com Inc (ADR) (NASDAQ:JD) will secure one seat on the board of directors of Bitauto Hldg Ltd (ADR)(NYSE:BITA). Upon closing, JD.Com Inc (ADR) (NASDAQ:JD) and Tencent Holdings will hold 17.7% and 26.6% of YiXin Capital, respectively.
In December 2014, JD.Com Inc (ADR) (NASDAQ:JD) announced a secondary offering of an aggregate of around 26 million American depositary shares (ADSs) by certain selling shareholders. Each share represents two Class A ordinary shares of the company. The offering was priced at US$23.80 per ADS.
Disclosure: none
