After a tough start to life as a public company, Chinese online-to-offline (O2O) home decoration services and product company SSLJ.com (NASDAQ:SSLJ) is seeing a sharp rise in shares Tuesday morning following announcing a strategic cooperation agreement with a subsidiary of JD.com (NASDAQ:JD), the biggest e-commerce company and retailer in China.
Per the pact with Beijing JD Century Trading Co., Ltd., both companies will cooperate on business throughout the country, which is anticipated to expand market share for each while slashing operating costs and improving overall efficiency. For an investment of an unspecified amount of money in JD's advertising platform, SSLJ will get a priority to distribute its products on JD's portfolio of sales channels, including JD Mall and JD Crowdfunding. Moreover, JD will use its resources to match target customers for SSLJ.
SSLJ says it expects to have "deep cooperation with JD in the field of Smart Homes." The relationship is hoped to speed SSLJ's expansion into e-commerce in response to growing consumer demand, kickstarting an improved supply/demand cycle for the Wuhan, China-based company's products.
SSLJ completed its IPO on Friday, selling four million shares at a price of $5.00 each for a total raise of $20.0 million. Shares began trading on Monday, slipping to wrap the day at $3.59, marking the latest of several Chinese companies to skid right out of the gates. Traders are responding favorably to the news this morning, though, driving shares upward by 18.9% to $4.27 as of about noon Eastern with about 300,000 shares changing hands so far in the trading session.
