Online consumer loans provider Qudian (NYSE: QD) has agreed to purchase 10.2 million newly issued Class A ordinary shares of Secoo (NASDAQ: SECO) at USD 100 million, according to a press release from Secoo on Wednesday.
This investment will allow Qudian to have a 28.9% stake in Secoo, which hosts more than 400,000 products from 3,800 global and domestic brands on its shopping platforms including its website, app, and brick-and-mortar stores.
In addition, Secoo and Qudian will form a strategic partnership to cooperate in supply chain management, user acquisition and retention, quality appraisals, post-sales services, and financing solutions.
Qudian targets hundreds of millions of young, mobile-active consumers in China who need access to small credit for their discretionary spending but are underserved by traditional financial institutions due to lack of traditional credit data or high cost of servicing.
Following the announcement, Secoo’s shares rose by 52.56% to USD 3.28 on Wednesday, while Qudian went up 5.44% to USD 1.55.
This article is part of KrASIA’s “China Brief” section, where KrASIA’s reporters will provide quick daily updates about the tech ecosystem in China.