Sep 27, 2019 (China Knowledge) - 26 Sep, Ctrip (CTRP), the largest online travel agency in China, revealed its major shareholder and Internet giant Baidu (BIDU) is offering up to 31.3 million American depository shares in the former.
The offer will come with a 30-day option to purchase an additional 4.7 million American depository shares from Baidu. In the meantime, no additional shares will be issued by Ctrip.
Upon the news, Ctrip’s stock fell by around 7.3%, closing at USD 29.81. Baidu’s shares rose by 2.2% to USD 105.07.
Baidu plans to raise around USD 1 bln through the sale of the shares. This comes after Baidu recorded a net loss of USD 49 mln (RMB 327 mln) in Q1 this year, its first-ever quarterly loss since going public in 2005. It recorded USD 351 mln (RMB 2.4 bln) in net income in Q2 2019, down 62% YoY.
Following the sale of shares, Baidu will continue to be the biggest investor in Ctrip.
In recent years, Baidu has been expanding its external investments portfolio, with an investment of USD 200 mln (RMB 1.4 bln) into software and IT services company Neusoft Holdings earlier this month.
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