Ctrip, Qunar partner to enjoy the online travel lion's share in China
27.10.2015 504 views
Chinese online travel agencies Ctrip.com and Baidu-backed Qunar Cayman Islands have announced a joint partnership valued at around USD 15.6 billion.
Qunar and Ctrip’s partnership involves a share swap rather than a straight acquisition or a merger, technode.com reports. Baidu will take on 25% of Ctrip, while Ctrip will take approximately 45% of Qunar. Ctrip CEO James Liang will join Qunar’s board of directors along with COO Jane Sun. Baidu CEO Robin Li and Tony Yip, head of Baidu investments, will join Ctrip’s board in return.
Ctrip is worth roughly double Qunar at USD 10.6 billion USD. The larger company attempted a complete buyout of Qunar around April, 2015, but the deal was rejected. According to Bloomberg data, the latest partnership bring the total value of Chinese internet deals to USD 62.5 billion USD for 2014. Major deals include the USD 6 billion USD merger between Alibaba’s Kuaidi Dache and Tencent’s Didi Dache and the USD 15 billion USD matchup between Dianping and Meituan.
Baidu has been investing in its O2O services in 2015, a strategy that has seen it cut deeply into net profits. Like other internet giants they have been subsidizing several of their services, including group-buying website Nuomi and Qunar, in an attempt to grab market share.
Baidu’s Nuomi competes directly with the newly merged Meituan-Dianping duo, a partnership between stakes held by Alibaba and Tencent. At the same time the Baidu-backed Uber China arm is in competition with the Ali-Tencent ride-hailing company Didi Chuxing (Didi Kuaidi).
Source: The Paypers