Why JD.com Stock Fell Today
Shares of JD.com (NASDAQ: JD) fell 4.1% on Tuesday, following reports that the Chinese e-commerce leader is mulling whether to make a bid to acquire British electronics retailer Currys. The move would spark a potential bidding war with U.S.-based activist investor Elliott Advisors.
On Saturday, Currys rejected an initial $883 million acquisition offer from Elliott Management, arguing the potential cash offer "significantly undervalued" the company. Currys operates around 300 stores and employs around 10,000 people. Shares of the electronics store chain had fallen more than 50% over the past two years leading up to Elliott's offer. Elliott subsequently stated it's weighing whether to make a second, higher offer.
In a statement Monday, however, JD.com representatives confirmed they're also considering whether to make a competitive acquisition offer. JD.com, for its part, has struggled to drive revenue growth in recent quarters -- with sales in its most recent quarter climbing only 1.7% year over year -- amid fierce competition and macroeconomic uncertainty in China.
Source Fool.com
