Chinese food delivery-to-ticketing platform Meituan Dianping increased the registered capital of its cloud computing subsidiary by 8,600% on December 25, according to corporate intelligence information platform (in Chinese).

Why it matters: The change underlines Meituan’s push into the cloud computing market. Chinese tech giants previously focused on consumer-facing businesses are moving quickly to enterprise-facing services. Cloud computing is a major component of this.

  • Meituan’s push to cloud computing business is reminiscent of Alibaba and Tencent’s shift to enterprise-faced services.
  • The lifestyle services unicorn announced in January that it would invest RMB 11 billion (around $1.7 billion) this year to help merchants upgrade their operations and drive the growth of China’s “Delivery Economy,” a term that refers to the country’s on-demand services boom.

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Details: The company’s commercial and business registration change shows that its registered capital increased 8,600% to RMB 870 million from RMB 10 million.

  • Meituan founder Wang Xing was replaced by Liu Minjuan as supervisor of the subsidiary.
  • Mu Rongjun, Meituan’s co-founder who owns 2.5% of the parent company, remains as executive chairman and manager of the cloud arm.
  • Mu Rongjun holds a dominating 95% stake in the subsidiary, while Wang Xing, who holds a minority 5% stake, is the ultimate beneficial owner of the firm.
  • A Meituan spokeswoman declined to comment on the change.

Meituan to invest $1.7 billion in push to digitize merchant partners

Context: Founded in June 2015, Meituan’s Beijing-based cloud computing arm is mainly engaged in data processing, technology consulting, infrastructure software services, application software services, software and equipment sales, and telecommunication.

  • The Hong Kong-listed parent group recorded a huge turnaround in 2019. It recorded a second quarterly profit with revenues increasing by 44.1% to RMB 27.5 billion from RMB 19.1 billion for the same period of 2018.
  • Alibaba rolled out in January the “A100” program. The program is designed to help companies embrace digital transformation as more tech giants are shifting to enterprise-facing services.
  • Tencent upgraded its organizational structure to focus on enterprise services and cloud computing last year.

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 More by Emma Lee

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