JD.com set to win EU approval for Ceconomy deal, source says

By Foo Yun Chee

BRUSSELS, Oct 2 (Reuters) – Chinese e-commerce giant JD.com is set to secure European Union approval for its $2.5 billion bid for German electronics retailer Ceconomy after it tweaked its remedies to address regulators’ concerns, a person familiar with the matter said.

The European Commission, which is the EU competition enforcer, is investigating the deal under the Foreign Subsidies Regulation that targets unfair foreign state aid.

At issue is whether JD.com received preferential financing, tax incentives and grants from the Chinese government that may have helped it to offer a higher price for Ceconomy.

The company, which in August offered to grant Ceconomy access to its European logistics and technological capabilities at market rates and also to let smaller rivals get access at fair and non-discriminatory rates, has improved its proposal after feedback from customers and rivals, the person said. 

The Commission, which will decide on the deal by November 4, Ceconomy and JD.com all declined to comment.

The acquisition would allow one of China’s largest retailers to expand outside its home market via Ceconomy-owned electronic products retailers MediaMarkt and Saturn.

(Reporting by Foo Yun Chee; Additional reporting by Matthias Inverardi in Duesseldorf; Editing by Jan Harvey)

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