July 15, 2024

DealBook: Baidu to Invest $306 Million in Travel Search Site

Baidu's headquarters in Beijing.Simon Lim/Agence France-Presse — Getty Images Baidu’s headquarters in Beijing.

7:06 p.m. | Updated

SHANGHAI — The Chinese search engine giant Baidu.com said on Friday that it would invest $306 million in Qunar.com, an online travel site planning an initial public offering.

The deal represents one of the largest investments ever made by Baidu, which has faced competition from social networking and online commerce sites.

Since Google moved its operations to Hong Kong last year, Baidu has become even more dominant as a search engine. But the company is also moving aggressively to diversify its online offerings to compete with Tencent, Sina, Alibaba and other big Chinese Internet companies.

In recent years, Baidu has formed a joint venture with the Japanese online shopping mall site, Rakuten, invested in a Hulu-like video site and sought to team up with mobile phone makers that use the Android operating system in the hope of having Baidu used in mobile search.

Qunar, which was co-founded by an American, Fritz Demopoulos, along with the Chinese-born Zhuang Chenchao and Douglas Khoo of Malaysia, is one of China’s fastest growing online travel sites. It provides searches on flights, hotels and group buying.

Travel inside of China has exploded with the country’s wealth and the growth of airports and high-speed rail. Ctrip.com, which is listed on the Nasdaq, is China’s best-known travel site and has a market value of about $23 billion.

Qunar was founded in 2005 and received early financing from the Silicon Valley venture firms Mayfield and GSR Ventures; it has also received financing from Tenaya Capital and GGV Capital.

“Baidu’s investment was a strategic investment,” said Mr. Zhuang, the co-founder of Qunar. “An I.P.O. is still part of our plan.”

Baidu closed Friday at $128.68 on Nasdaq, valuing the company at around $45 billion and making it one of the world’s richest Internet companies.

Article source: http://feeds.nytimes.com/click.phdo?i=2b16aa4a746c617042a61283b70012a6

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