YF Capital leads $315m Series E for China MRO player
Zhenkunhang, a China-based distribution platform for industrial products, has raised $315 million Series E funding led by YF Capital - previously Yunfeng Capital - a private equity firm co-founded by Alibaba’s Jack Ma.
China Structural Reform Fund, CIC Capital, and two funds involving Xiamen C&D, a state-owned supply chain and real estate conglomerate, also committed capital. C&D is participating through Xiamen C&D Emerging Industry Equity Investment and through a vehicle launched in conjunction with logistics giant GLP.
Existing investors Genesis Capital, Eastern Bell Capital, Tencent Holdings, Tiger Global Management, Matrix Partners China, Legend Capital, and Cowin Capital all re-upped.
The Series E is described as the largest single round in China’s industrial products space. Zhenkunhang raised $160 million in a Series D round last year led by Tencent. This followed a $129 million Series C, which was led by Legend and Tiger Global, and featured the China unit of energy giant Shell and Oriza Holdings.
Founded in 1996 and also known as ZKH360.com, the company positions itself as a leader in industrial maintenance, repair and operations (MRO). It serves as a one-stop-shop for products such as industrial accessories, consumables and spare parts. The goal is to rebuild traditional procurement channels through digitization of the entire supply chain, integrating trading platforms, digital tools, and intelligent services.
Zhenkunhang carries four million products from more than 8,000 brands and serves over 15,000 industrial customers. It claims to have the largest business scale, fastest growth, and most comprehensive service capabilities of any company in China's industrial supply industry.
Competitors include JD MRO, a subsidiary of Chinese e-commerce giant JD.com that specializes in MRO. It closed $230 million in Series A funding in May at a post-deal valuation of $2 billion.
AVCJ Research’s records show that Zhenkunhang received Series A funding from Cowin in 2015. This was followed by a RMB360 million ($53 million) Series B in 2017 that featured Cowin and Eastern Bell, among others.
China Renaissance served as exclusive financial advisor on the Series E round.
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