China’s biggest internet company Tencent has signed a deal to buy a stake in Sinopec’s sales and marketing arm, according to MarketWatch. This gives Tencent access to the oil giant’s retail operations across China.
The maker of WeChat is one of several investors involved in the deal with China’s biggest oil company. The deal is worth RMB 107.1 billion (US$17.44 billion) from 25 new investors, which also include insurance giant PICC, and asset management firm Munsun. Each company can own up to a 2.8 percent stake.
State-owned Sinopec is listed as the fifth largest company in the world by revenue, and is now looking to partially privatize. It operates over 30,000 gas stations and more than 23,000 convenience stores in China.
Tencent and Sinopec will work together in mobile payments, big data, and navigation. Some possible avenues for cooperation include creating loyalty programs, cross-marketing, and online-to-offline retail. Their partnership will be limited to non-oil business.
Sinopec told Reuters it plans to leverage Tencent’s WeChat and QQ messaging apps. Tencent recently added a payment feature to WeChat that allows users’ credit cards to be charged via an in-app barcode for offline purchases. Buying a tank of gas with WeChat might soon be a reality.
Sinopec signed other deals with private Chinese firms like delivery service SF Express and ecommerce company Yihaodian earlier this year to provide more services for its customers.
(Source: MarketWatch; top image via Flickr user Minale Tattersfield)
New Tencent deal with China’s biggest oil company means you could soon pay for a tank of gas with WeChat
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