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The Nanjing Intermediate People’s Court has delivered a first-instance verdict in a legal dispute involving Wanda Group and Suning.com, ordering the former to pay the latter 1.7 billion Chinese yuan (approximately 260 million US dollars) for breaching a 2018 share buyback agreement.
The financially struggling Chinese real estate developer is required to settle the 1.7 billion yuan within ten days of the ruling, along with additional damages for delayed payment. These damages are calculated at one and a half times the one-year loan prime rate from February 26, 2024, to February 13, 2026, as announced by Suning.com yesterday, citing the court’s decision.
Shares of Suning.com [SHE: 002024] rose by 2.6 percent to 1.18 yuan (around 17 US cents) as of 1:55 p.m. in Shenzhen today, after climbing by as much as 5.2 percent earlier in the session.
The court also ordered Wanda to pay an 8.8 million yuan (approximately 1.3 million US dollars) fee for filing the case. All of Wanda’s other claims were rejected, according to the retail giant headquartered in Beijing.
Wanda’s property management division, Wanda Commercial Management Group, went public in Hong Kong in 2014. However, Wang Jianlin, the company’s founder, believed the stock was undervalued and subsequently took the company private to prepare for a listing on the Chinese mainland.
As part of the privatization effort, Tencent Holdings, Suning.com, Sunac China, and JD.com invested a total of 34 billion yuan (around 5 billion US dollars) to acquire a 14 percent stake in Wanda Commercial Management, Wanda stated in January 2018. Suning.com paid 9.5 billion yuan for a 4 percent share.
Despite these investments, Wanda Commercial Management did not proceed with an initial public offering on the mainland.
In October 2024, Suning.com filed a lawsuit claiming Wanda and Wanda Commercial Management breached their cooperation agreement. Suning.com contended that Wanda owed it 5 billion yuan in share buyback fees.
In the first quarter of this year, Suning.com reported a net profit of 28.9 million yuan (roughly 4.3 million US dollars), representing a 61 percent increase compared to the same period last year. However, excluding non-recurring gains and losses, the company experienced a net loss of 861 million yuan (around 130 million US dollars), which was a 334 percent increase in losses for the period.
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