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JD.com buys back shares following CEO controversy

Fashion

JD.com buys back shares following CEO controversy

By Robyn Turk

Dec 26, 2018

JD.com will buy back 1 billion dollars worth of its shares. While the Chinese e-commerce giant’s plans are partly due to concerns of China’s economy, this comes just after charges against the company’s CEO have been dropped.

CEO Richard Liu will not be charged with sexual assault, following an investigation in Minneapolis. Liu had been arrested in August, and accused of raping a 21-year-old student. During this time, the billionaire CEO had been involved in an executive program within the University of Minnesota.

“As we reviewed surveillance video, text messages, police body camera video and witness statements, it became clear that we could not meet our burden of proof and, therefore, we could not bring charges,” Hennepin County Attorney Mike Freeman explained the county’s reasons against charging Liu in a statement. “Because we do not want to re-victimize the young woman, we will not be going into detail.”

JD.com’s share buyback program is intended to lift stock prices that have been weighed down by Liu’s recent controversy. The company’s shares dropped by more than 60 percent this year, mostly due to poor publicity related to Liu. Shares of JD.com had traded at almost 51 dollars per share at the start of this year, falling to under 20 dollars recently.

The 1 billion dollars of its shares will be bought back during the course of the next 12 months, funded by JD.com’s existing cash balance.