China technology company JD.com, Inc. has applied to list the shares of its JD Logistics unit in Hong Kong.
JD Logistics' initial public offering might raise at least $5 billion and value the unit at around $40 billion, according to news reports quoting people with knowledge of the matter.
JD.com's shares rose more than 5% in Hong Kong Wednesday. Upon completion of the proposed spinoff JD.com will continue to indirectly hold more than 50% of JD Logistics.
JD Logistics is the delivery arm of China's second-biggest e-commerce company. The decision to list in Hong Kong follows the offering of the company's health care arm JD Health. It held a $3.5 billion offering in December.
"The spin off and separate listing will help JD.com crystallize the value of its logistics unit, which it had invested in heavily for more than a decade," according to Bloomberg Intelligence analyst Vey-Sern Ling.
JD.com said it would float JD Logistics shares on an unidentified second exchange in what the company calls a "global offering." JD.com didn't elaborate.
JD.com spent years building one of mainland China's biggest courier facilities to ensure on-time delivery and maintain control over shipping.
JD.com currently holds nearly 80% of JD Logistics, which was incorporated in 2012. JD Logistics holds the top spot in terms of sales in China. As of September the logistics arm operated more than 800 warehouses throughout the country.
JD.com registered its secondary listing in Hong Kong in June 2020, becoming the third U.S.-listed China company to make a secondary listing there.