Meituan-Dianping, the top provider of on-demand services in China, has received an undisclosed amount of investment from the funding unit of China Resources Group, a state-owned conglomerate, according to a company announcement.

This is the second round of funding that the joint venture has announced since its merger in October 2015. In January this year, the firm closed a massive $3.3 billion USD funding round. With the huge amount of capital in pocket, the current funding is perhaps of more strategic significance, combining Meituan-Dianping’s online platforms with China Resources’ retail assets.

A number of retail brands under China Resources  will be integrated into Meituan Dianping’s online platform as part of the deal, including its supermarket brands Vanguard, Suguo, Tesco, OLE, Vango convenience stores and Pacific Coffee. The new partnership will boost Meituan-Dianping’s capabilities amid its competition with powerhouses like Baidu Waimai and Ctrip.

This investment is among a series of online expansion endeavors by China Resources. The company launched e-commerce site Ewj.com for supermarket chain store Vanguard last year. They have also tried out on-demand delivery services in southern and eastern China. However, most of these services failed to gain traction.

Last year, China Resources sold its entire 35% stake in the joint ventures it had established with WalMart.

Meituan-Dianping now claims to have over 600 million users and cooperates with around 4.32 million offline service providers. Their daily peak volume hit 11.5 million orders in June, according to data released by the company.

China’s state-backed entities, who tend to be more conservative in betting on emerging industries in the past, are taking an increasingly active role in the capital market for internet companies. State-backed insurance company China Life has invested in Didi Chuxing and Uber. The state-owned investment institution of postal service China Post Group Corp. and China national social security fund are both investors in Ant Financial.

Emma Lee

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.

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