Key insights
- JD.com's acquisition of Ceconomy faces EU antitrust scrutiny over potential Chinese subsidies. JD.com denies the use of subsidies, stating the deal is funded by private debt and cash. While the outcome impacts JD.com and Ceconomy, the direct influence on the broader US equity market is slightly negative, reflecting concerns about global trade and regulatory hurdles for international deals.
BRUSSELS, May 28 (Reuters) - JD.com's acquisition of German retailer Ceconomy will not be financed by Chinese subsidies, the Chinese online retailer said on Thursday after EU antitrust regulators opened a full-scale investigation under the bloc's subsidy rules.
"The proposed acquisition of CECONOMY AG by JD.COM will not be financed by any foreign subsidies granted by China or any other non-EU Member State, but instead is funded by external private bank debt and available cash from ordinary course business activities," the company said.
"JD.COM has not received any foreign subsidies in relation to the transaction that might give rise to a distortion of competition in the EU," it added.
(Reporting by Foo Yun Chee;Editing by Sudip Kar-Gupta)