File photo: IC

The Chinese retailer Suning.com expects colossal net losses of up to 3.2 billion yuan ($495 million) for the first half of the year, according to a stock filing late Monday.

The company said it was confronted with phased challenges and a plunge of over 30 percent in its estimated sales revenues for the second quarter year-on-year, which resulted in a substantial decline in its gross earnings over the past quarter.

By comparison, its losses for the first half of last year stood at 167 million yuan.

The e-commerce conglomerate whose debt-laden parent Suning Appliance Group has been scrambling to repay a pileup of bonds, also announced a deal to sell a 16.96 percent stake to a consortium led by Alibaba's digital marketing arm Alimama and an equity investment firm owned by East China's Jiangsu Province where Suning is headquartered.

Among the consortium's industrial investors are local tech giant Xiaomi and home appliance makers Haier, Midea and TCL. 

The diversity of investors in the consortium,  funded by state-owned capital and industrial investment,  is willing to push for improved operations and management at the retail arm of Suning and help with its transition toward a retail service provider. The deal will fit Suning.com's stable operations, as noted in another filing with the Shenzhen Stock Exchange. 

After the deal, Suning's chair, Zhang Jindong, and Suning Holdings Group will hold a 20.35 percent in Suning.com, while Alibaba's Taobao will remain the retailer's second-largest shareholder with a 19.99 percent stake. The Suning-Taobao alliance was announced in 2015.

The consortium will become the third largest shareholder with a 16.96-percent stake. 

In voting power terms, Zhang's voting rights will decrease to 17.62 percent from 20.96 percent but he will still be the largest voting shareholder. 

As such, the company will have neither a controlling shareholder with a direct or indirect stake of more than 50 percent, or a shareholder with actual voting rights of over 30 percent.

Meanwhile, the retailer announced the end of an agreement in late February to sell a 23 percent stake to two state-owned firms, Shenzhen International Holdings and Shenzhen Kunpeng Equity Investment Management.

All parties had engaged in active communication following the signing of the deal but they failed to strike a substantive formal agreement, Suning.com said in separate filing. 

Trading of shares from the retailer has been suspended since June 23 after its announcement of plans to issue shares to purchase assets. It was also announced on Monday that the asset purchase plan has been terminated. Its trading will be resumed on Tuesday. 

Its shares have shed 27.5 percent this year after a fall of 23.36 percent throughout last year.