The Chinese e-commerce company JD.com may be on the verge of its largest acquisition in Europe to date. The Beijing-based group could take over the Düsseldorf-based company Ceconomy, which owns Europe's largest electronics chain MediaMarktSaturn, for around €2.2 billion. Ceconomy itself confirmed last week in a mandatory announcement that it was in "advanced negotiations" with JD.com about a "possible public takeover." However, the talks are open-ended.
This means that one of China's most important digital groups is reaching out to a traditional German company. The entry would not only be a milestone for JD, but also an indicator of the changed strategy of many Chinese groups, which are turning outwards in the face of enormous competition and price wars in their domestic market.
The takeover would have several advantages for JD.com: MediaMarkt and Saturn are established brands with a large customer base, over 1,000 stores and sales of around €22 billion. The online share is less than 30 percent, which is exactly where JD could use its experience. JD's technical infrastructure is one of the best that global retail currently has to offer.
However, Ceconomy's store structure could also become a burden for JD.com. Although JD itself operates brick-and-mortar stores and shopping malls in China, the scale of the Ceconomy network is of a different caliber. Industry experts doubt that JD would hold on to all of its locations.
The move to Europe would not be a sign of excessive expansion, but an expression of a search for security. Competition on the Chinese e-commerce market has become brutal in recent years. While competitor Alibaba focused on diversifying its platforms and rolled out its own logistics systems, Pinduoduo pushed into the market with rock-bottom prices.
JD is therefore under double the pressure. In the upper price segment, it is up against Alibaba, while Pinduoduo eats its way through with discounts in the lower segment. JD's calculation: In Europe, where the online share of total sales in electronics retail is still significantly lower than in China, it may be possible to build an advantage with technology and logistics expertise.
The desire to expand is not entirely new. JD had already attempted to take over the British electronics retailer Currys at the beginning of 2024, but failed due to political concerns. The Ceconomy deal would now be the second opportunity to establish a European foothold.
JD, founded in 1998 by Richard Liu, was long regarded as a fit Alibaba contender. Liu set himself the goal of transforming JD into a global retail company early on. Back in 2018, he said in an interview with Handelsblatt that he also wanted to make acquisitions in Germany. But back then, the problems in China were piling up. The economy came to a standstill and consumer sentiment fell, especially among young city dwellers. New business areas such as JD Health are only growing slowly.
The entry into the food delivery business is currently the subject of particularly heated debate. JD is trying to wrest market share from the top dog Meituan – by investing heavily. Drivers, restaurants and customers are lured with bonuses, better conditions or discounts. The state has already reacted: In spring, the responsible supervisory authority called on platform providers to end their ruinous price wars.
Competition is "intense," JD warned last year in its annual report. Short-term legislative changes, greater government intervention or new requirements could also have a significant impact on business.
Whether JD actually wins the bid for Ceconomy remains to be seen. In addition to regulatory issues, major shareholders such as the Kellerhals family could also block the deal. They have repeatedly opposed fundamental restructuring of the company in the past. The competition authorities in Germany and at the EU level are also likely to watch closely.
The Chinese will now have to provide proof: Can they be more successful in Europe than the German takeover candidate once was in China? The latter also had big plans and opened its first MediaMarkt store in Shanghai in 2010. At the time, however, it was still backed by Metro AG, whose portfolio included MediaMarkt and Saturn until the group was split up. Together with Foxconn, the aim was to expand in China, initially in Shanghai and later nationwide. But after just a few years, it was over: MediaMarkt withdrew completely from the Chinese market in 2013.