By Jiahui Huang
Chinese food-delivery giant Meituan plans to acquire the China business of online grocer Dingdong for $717 million, a move that would strengthen its position in the grocery retail market.
Meituan said Thursday that it entered an agreement to acquire Dingdong Fresh Holding, a subsidiary of Dingdong, at an initial consideration of $717 million. The move is in line with the company's long-term development plan in the grocery retail sector, it said.
U.S.-listed Dingdong said in a separate statement that its international business isn't part of the transaction. The fresh grocery e-commerce company operated over 1,000 front warehouses in China as of September, with more than 7 million monthly transacting users.
The deal comes as Meituan, a longtime leader in China's food-delivery business, has been under pressure from e-commerce platform JD.com and Alibaba Group amid a brutal price war.
The Beijing-based company swung to a net loss in the third quarter last year as it continued to offer aggressive discounts to customers to defend market share. Consumer sentiment in China has also remained subdued, posing another headwind for the Chinese shopping-and-delivery platform.
Write to Jiahui Huang at jiahui.huang@wsj.com
(END) Dow Jones Newswires
02-05-26 0537ET
