Walmart and JD.com invest $500 million in a Chinese online delivery company

Zhang Peng | LightRocket | Getty Images

JD.com is one of the biggest e-commerce and logistics company in China. 

A Chinese online grocery delivery company Dada-JD Daojia said on Thursday it has raised $500 million from U.S. retailer Walmart and JD.com in its latest round of financing.

Dada-JD Daojia was formed from the merger of JD Daojia, which is JD.com's online-to-offline business, and Dada Nexus, a large crowd-sourcing delivery platform in China with operations in more than 400 major cities.

JD Daojia delivers goods from local supermarkets and other partners via a location-based smartphone app and has about 20 million monthly active users.

"By working with strong partners, and investing in digital capabilities, we will create easier and more convenient shopping experiences for customers," Wern-Yuen Tan, president and CEO of Walmart China, said in a statement.

Walmart first partnered with Dada-JD Daojia in 2016, according to the Chinese company.

Earlier this year, the U.S. retailer opened its first small high-tech supermarket in China where customers use smartphones to pay for items that are available on Walmart's virtual store on JD Daojia's platform.

JD.com, which competes aggressively with China's largest e-commerce player Alibaba, also has the backing of other prominent global and local names in technology such as Google and Tencent.

In June, Google said that it will invest about $550 million in cash into JD.com as part of a strategic investment.

For its part, JD.com said it planned to make a selection of items available for sale in places like the U.S. and Europe through Google Shopping — a service that lets users search for products on e-commerce websites and compare prices between different sellers. The partnership would open a channel for JD.com to sell to consumers outside China, especially at a time when trade tensions between Beijing and Washington are high.

JD.com is also backed by Chinese tech company Tencent, which operates the country's largest social messaging platform called WeChat. As a result, JD.com is able to sell directly to consumers through the WeChat app.