Walmart (NYSE: WMT), one of the largest shareholders of Chinese e-commerce company JD.com (NASDAQ: JD), has sold its entire JD.com stake, ending an eight-year investment partnership and focusing on its own business in China.

According to people familiar with the matter, the Walmart share placement has been fully subscribed, and the transaction will be worth $3.74 billion if calculated at the high end of the proposed range. After the sale of shares, Walmart plans to increase its investment in Sam's Club business in China, highlighting the company's emphasis on the Chinese market.

JD.com's stock price has fallen by about 70% since its peak in early 2021, and has remained basically at the 2016 level since Walmart became a major shareholder in JD.com.

"This decision allows us to focus on the successful operation of Walmart China and Sam's Club while allocating funds to other priorities," Walmart said in a statement. In addition, Walmart also emphasized that the company will continue to maintain a business partnership with JD.com.

JD.com said in a statement that it is confident in the future cooperation between the two parties.

The terms of the deal show that Walmart sold a total of 144.5 million JD.com American depositary shares (ADS) at a price range of $24.85 to $25.85 per share, with Morgan Stanley as the lead underwriter for the offering. The price is up to 11.8% lower than Tuesday's closing price of $28.19. Morgan Stanley has not responded so far.

JD.com's Hong Kong-listed shares fell more than 10% on Wednesday on the news, while its U.S.-listed shares fell 10% to $25.50 in after-hours trading on Tuesday.

JD.com said in an exchange filing that it had repurchased $390 million worth of shares on Wednesday, part of a $3 billion repurchase plan approved in March this year.

Although the company reported higher-than-expected second-quarter profits last week, mainly due to its low-price strategy, China's retail market is still affected by a continued decline in consumer confidence, which stems from a slowdown in the real estate market and concerns about employment and income.

Major e-commerce companies including JD.com, Alibaba (NYSE: BABA) and Pinduoduo (NASDAQ: PDD) have launched a fierce price war to attract consumers to buy, resulting in pressure on sales growth and profits.

Analysts believe that the share sale will allow Walmart to obtain funds and enable JD.com to focus on its core online business, but the strategic cooperation between the two companies in areas such as data exchange is still likely to continue.

Walmart's revenue in China in the second quarter increased by 17.7% year-on-year to US$4.6 billion, driven by strong growth in its Sam's Club chain and digital business.

According to LSEG data, the US retail giant Walmart holds a 5.19% stake in JD.com. Walmart's cooperation with JD.com began in 2016, when Walmart sold its Chinese online grocery store "Yihaodian" to JD.com in exchange for a 5% stake in the latter.