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Tag Archives: Qunar
Qunar company news. Find out the latest breaking news for Qunar Cayman Islands Limited (QUNR).
Overview of an expert, doug Young.
Qunar, one of China’s largest online travel booking platforms, plans to expand its mobile business with a new $500 million investment
Bottom line: The equity tie-up between Ctrip and Qunar is likely to be an uneasy one driven by necessity rather than desire to work together, and stands a 50-50 chance of ending in divorce.
Ctrip, Qunar get hitched … sort of
The year 2015 will go down in Chinese Internet history as the year of the uneasy partnership, as several pairs of former foes suddenly merged even as their outspoken heads refused to work together. The latest of those unions is seeing former bitter rivals Ctrip (Nasdaq: CTRP) and Qunar(Nasdaq: CTRP) get together in a quasi marriage that qualifies as the largest and also strangest union to date.
This particular union isn’t even really a true marriage, and instead is a very big equity swap that will see Qunar’s controlling stakeholder Baidu(Nasdaq: BIDU) get 25 percent of Ctrip. Ctrip will get a larger chunk of Qunar on a percentage basis, ending up with 45 percent voting interest in its former rival. (Baidu announcement; English article; Chinese article) Like the other odd marriages this year, this latest one looks set for troubles, and could stand a very real chance of divorce. Read Full Post…
The following press releases and media reports about Chinese companies were carried on October 27. To view a full article or story, click on the link next to the headline.
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Bottom line: Baidu’s reported plan to sell its online music unit looks like a smart way to rid itself of a controversial piracy-plagued business that holds little value for its main strategic focuses going forward.
Baidu set to dump music unit?
In what could be a move that’s long overdue, leading search engine Baidu (Nasdaq: BIDU) is reportedly eyeing a sale of a music division that was once one of its major attractions but in recent years has become more a liability due to frequent accusations of copyright violations. Baidu wasn’t commenting on the reports, but such a move would be consistent with its recent diversification into a range of new areas, none of which include music as part of their core business.
Such a deal, if it’s really in the works, probably wouldn’t be worth too much, perhaps in the $100-$500 million range at the very most. More significantly would be the disposal of a unit that in the past has come under fire for allowing rampant piracy through illegal peer-to-peer (P2P) trading of copyrighted music. Read Full Post…
Bottom line: A threat to privatize Baidu by chairman Robin Li is probably the result of frustration at recent declines in the company’s stock and is unlikely to result in a serious buy-out bid.
Frustrated Robin Li threatens Baidu privatization
The biggest privatization threat to date by a US-listed Chinese company has just come from online search leader Baidu (Nasdaq: BIDU), whose chairman Robin Li is joining a growing chorus of executives who say their shares are underappreciated by Wall Street investors. In this case it’s easy to see why Li is unhappy, since Baidu’s stock has lost a quarter of its value since July, when the company reported a spending binge on new businesses had sapped its profits.
Baidu’s shares were actually down by an even greater 30 percent at the start of this week, but surged 6 percent in the latest session amid a broader rally for Chinese Internet stocks. It should come as no surprise that the US surge was sparked by a rally earlier in the day on China’s domestic stock markets, which is where Baidu and many of its other US-listed Internet peers say they would like to re-list. Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 8. To view a full article or story, click on the link next to the headline.
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UPDATE: Since originally writing this post, Internet giant Tencent has launched its own buyout offer for eLong. Ctrip has commented that cooperation with Tencent would represent a win-win. (Chinese article)
Bottom line: Ctrip is likely to make a buyout offer for eLong by year-end, but its profits will remain under pressure for at least the next year as it battles with Qunar for market share.
Profits under pressure at the Ctrip lodge
Leading online travel agent Ctrip (Nasdaq: CTRP) has just released its latest quarterly results that show just how fierce competition has become in China’s travel market, as heavy spending eroded its profits despite big revenue growth. That competition was even more evident in the latest results for eLong (Nasdaq: LONG), which was once Ctrip’s main rival but more recently has developed an increasingly cozy relationship with its former foe.
I’ve been predicting for the last few months that Ctrip will ultimately make a buyout bid for eLong, following a steady series of recent moves that were bringing the companies closer together. The announcement of Ctrip’s and eLong’s latest quarterly results on the same day seems like more than coincidence, and is further evidence that a marriage could soon be coming. But before any formal marriage proposal, Ctrip would also be wise to take a long, hard look at eLong’s financials, which don’t look too impressive. Read Full Post…
Bottom line: Ctrip is likely to make a counter-bid for eLong following a surprise offer from Tencent, sparking a potential bidding war that should ultimately see Ctrip emerge as the victor.
Tencent launches surprise bid for eLong
I’ve been predicting for the last few months that leading online travel site Ctrip (Nasdaq: CTRP) would make a buyout bid for former rival eLong (Nasdaq: LONG), so I was quite surprised to read that such a bid has come instead from Internet giant Tencent (HKEx: 700). This particular move is all the stranger because Tencent hasn’t shown much interest in the travel sector before now, though it previously invested in eLong and now owns about 15 percent of the company.
I also have to suspect that this particular bid came without the knowledge of Ctrip, which itself owns 37 percent of eLong. Ctrip got its stake after joining a group that bought out a controlling 62 percent of eLong previously held by US travel giant Expedia (Nasdaq: EXPE) earlier this year. Tencent has owned its stake in eLong since 2011. Ctrip’s recent moves have all pointed to its own buyout offer for eLong, leading me to believe that we could quickly see a bidding war break out for the company. Read Full Post…
The following press releases and media reports about Chinese companies were carried on August 5. To view a full article or story, click on the link next to the headline.
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eLong (Nasdaq: LONG) Receives “Going Private” Proposal from Tencent (PRNewswire)
Alibaba Group (NYSE: BABA) Appoints Michael Evans as President (Businesswire)
Qunar (Nasdaq: QUNR) Achieves Record Daily Hotel Room Nights Stayed (GlobeNewswire)
Toyota (Tokyo: 7203) Says Not Optimistic on China Profitability (English article)
PetroChina (HKEx: 857) Wins Dismissal of Securities Lawsuit in US (English article)
Bottom line: Baidu’s heavy spending on new businesses is rapidly eroding its profits, a strategy that looks acceptable over the short-term but should be abandoned within a year or two if it fails to produce results.
online search leader Baidu
Baidu profit disappoints
I have to commend online search leader Baidu (Nasdaq: BIDU) for steadily maintaining strong revenue growth of 30 percent or more over the last few years, even as China’s overall economy has started to slow and the company faces growing challenges from new rivals. But that said, Baidu‘s costs seem to be rising even faster that its revenue, which has led to anemic profit growth in its latest quarterly results.
At the end of the day, investors should be most concerned about profits at any company, since a stock price is directly tied to the bottom line. But Baidu seems to be less interested these days in profits. The company is indeed facing many challenges, both to its core search business and also as it expands into new areas, which is driving the rising costs. But it also needs to learn to bring those costs under control, to roughly in line with revenue growth, or risk facing the wrath of investors.
Bottom line: The move by a Ctrip vice president to the role of CEO at eLong represents growing ties between the 2 companies, with the former likely to make a buyout offer for the latter within the next year.
Ctrip exec takes over at eLong
A new executive move between online travel leader Ctrip (Nasdaq: CTRP) and the smaller eLong (Nasdaq: LONG) shows the pair of former rivals are moving closer together, hinting at a potential outright merger in the not-too-distant future. Such a merger would have been major news just 5 years ago, when this pair of companies were the 2 clear leaders in China’s online travel sector.
Since then, however, eLong has sputtered under the ownership of US travel giant Expedia (Nasdaq: EXPE), which finally called it quits in May and sold its stake in the Chinese company. (previous post) Ctrip was quick to jump in and purchase 37 percent of eLong for $400 million, and has now moved even closer to its former rival with this new executive move. Read Full Post…
Bottom line: Baidu’s spending blitz at Nuomi looks like a good but expensive strategy to help the company quickly pick up market share in the group buying space, and could pose a serious challenge to industry leaders Dianping and Meituan.
About Internet Giant Baidu
Baidu revs up spending at Nuomi
Internet giant Baidu(Nasdaq: BIDU) is making a major push into the group buying space, announcing a bold campaign that includes 20 billion yuan ($3.2 billion) in new spending as it aims to replicate its earliest success in online search. This particular campaign is focused on Baidu’s Nuomi group buying site that it purchased a year and a half ago, and has the site’s chief saying he aims to overtake industry leaders Dianping and Meituan in the next 1 year and 3 years, respectively.
This particular campaign surprised me a bit, as Baidu hasn’t really announced any major plans for Nuomi since buying the company from struggling social networking site Renren (NYSE: RENN) for more than $200 million. But this kind of move would be similar to what Baidu did with online travel site Qunar (Nasdaq: QUNR), which was already growing quickly when Baidu purchased a controlling stake in 2011. Since then, Qunar has made an IPO and Baidu has poured big money into the company, which is now posing a serious challenge to longtime industry leader Ctrip. (Nasdaq: CTRP) Read Full Post…
