Two-bagger for eCargo in merger with former PM’s daughter
Health & Biotech
Health & Biotech
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China-based eCommerce tech eCargo has surged more than 230 per cent today after announcing its purchase of a 45 per cent stake in Aussie online retailer Jessica’s Suitcase.
The store is run through Alibaba’s Tmall and was founded by Jessica Rudd (daughter of former prime minister Kevin Rudd) who will join the eCargo board.
Shares in eCargo (ASX:ECG) were trading at 28c on Monday afternoon, up 233 per cent.
Under the agreement, eCargo will acquire 45 per cent of share in Jessica’s Suitcase but Ms Rudd will maintain management control, leveraging her influence in both the Australian and Chinese markets.
The lawyer, author and ‘mummy blogger’ previously lived in Beijing for five years, and now represents product ranges from Aussie brands the likes of Penfolds, Wolf Blass, skincare brand Sukin and fellow ASX-listed goat milk formula maker Bubs (ASX:BUB).
“Since we launched Jessica’s Suitcase I’ve learned a lifetime of lessons about how Australia and the wider West could, with the right help, flourish in the world’s largest and savviest cohort of consumers,” she told the market.
The merger adds to eCargo’s offering as a ‘one stop’ enabling partner for leading fashion brands like Ted Baker and Juicy Couture.
“The combined business will offer ECG a scale to plan for new Daigou services against the strong demand of Australia and New Zealand products by Chinese consumers through the rapidly-growing cross-border eCommerce channel,” they told the market.
Jessica’s Suitcase has over 80,000 followers on Alibaba’s Tmall and reported $451,000 in revenue for the first 5 months of the financial year.
Ms Rudd moved to Beijing with husband Albert Tse in 2009, and launched the business in mid-2015 after noticing her Chinese friends’ interest in Australian products.
“Jessica is the only Australian-born-and-based Key Opinion Leader in the eCommerce and digital marketing sectors, who has a strong reach in both Australia and China markets, which will significantly enhance ECG’s growth prospects and enable ECG to significantly benefit from the cross-border trade between Australia and China,”ECG chairman John Lau said.
Shares in ECG have traded between 4c and 33c in the past year.