Expedia's 62.4% stake was sold for $671 million to a group of buyers including Ctrip.com International Ltd. , Keystone Lodging Holdings Ltd., Plateno Group Ltd. and Luxuriant Holdings Ltd.
Shanghai-based Ctrip said in a separate news release that it has acquired a 37.6% equity stake in eLong for a total purchase price of approximately $400 million.
Expedia's involvement with eLong dates back to 2005, when Expedia's then-parent IAC/InterActive Corp took a controlling interest in the Chinese company. Over the last decade Expedia boosted its stake to the 62.4% it sold Friday.
Last July, rumors swirled that Expedia planned to sell its stake in eLong to Ctrip, which the Bellevue, Wash., travel site at the time dismissed.
In its most recent quarter, Expedia warned that spending would continue to grow at eLong, where losses have widened as the website spends more on sales staff, marketing and discounts to lure travelers in the world's most populous nation. Expedia's first-quarter profit fell 31%, in part thanks to eLong.
Meanwhile, the acquisitive company has been amassing brands in an effort to add new customers.
Competition in the space has intensified from new rivals including Google Inc. and Airbnb Inc., and as hotels cut commissions, they pay to booking sites. Expedia and rival Orbitz Worldwide Inc. in February agreed to a $1.3 billion tie-up that would bring many of the top U.S. travel-booking sites under one roof. Earlier this year, Expedia bought smaller rival Travelocity for $280 million.
Other deals over the past year include Australian online travel agency Wotif.com Holdings Ltd. and European online car-rental reservation company Auto Escape Group.
Expedia shares were inactive in pre-market trading. Shares in Ctrip rose 1.1%.
Source: Wall Street Journal by Lisa Beilfuss
from China Travel & Tourism News http://ift.tt/1iB6EFm
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