Yesterday, 10:08 AM
- Baidu (BIDU -1.2%) is off moderately in early trading after top Chinese local deals site Meituan.com (backed by Alibaba) announced a merger with #2 deals site and leading restaurant review platform Dianping.com (backed by Tencent), with the goal of creating a giant in the online-to-offline (O2O) services space.
- Meituan/Dianping sport a combined $15B valuation. U.S. local deals leader Groupon (GRPN +2.7%), which sports only a $2.4B market cap, is trading higher. The Nasdaq is up 0.7%.
- Meituan and Dianping both compete against Baidu's Nuomi deals platform (the market's #3 player), which it bought from Renren last year. Baidu has committed RMB20B ($3.2B) to growing its O2O offerings, with Nuomi expected to receive a large chunk of the investment.
- CEO Robin Li has suggested Baidu is investing heavily in O2O to head off the threat of mobile users bypassing its search platform and directly launching 3rd-party mobile apps, and that its spending includes building a large salesforce to win over small businesses. Meanwhile, in a recent WSJ column comparing Baidu/Nuomi and Meituan, Baidu exec Zeng Liang stated Baidu's spending on subsidies for O2O transactions "is not small," and that the company could expand its O2O offerings to cover financial and logistics services.
- Notable Calls reports hearing a tier-1 desk call the Meituan/Dianping deal a "clear negative" for Baidu. It also hears a boutique shop stating a meeting with Baidu suggests the company's Q3 op. margin will be closer to 10% rather than an expected 15%.
Thu, Jun. 18, 12:02 PM
- Nokia (NOK +1.5%) is "leaning toward" selling its HERE mapping/navigation software unit to a consortium featuring HERE clients BMW, Audi, and Daimler, Bloomberg reports. However, the automakers reportedly "may hesitate to pay the as much as $4 billion being sought for the unit."
- Final bids are said to be due this week. One source states Baidu (NASDAQ:BIDU), which previously teamed with UBER and P-E firm Apax, may join the automakers' bid. Apax and other P-E firms have dropped out of the bidding.
- Last month, the NYT reported Uber had bid up to $3B for HERE, and Reuters reported the automakers' bid was backed by P-E firm General Atlantic.
Mon, Jun. 1, 7:35 PM
- "On May 8, 2015, we received an unsolicited offer from Ctrip.com International (NASDAQ:CTRP), Ltd., or Ctrip, to acquire all of our outstanding shares," says Qunar (NASDAQ:QUNR) in its Q1 report. "After careful consideration of such offer, we declined to pursue it in a letter response dated June 1, 2015 ... we remain open to engaging in further discussions with Ctrip as well as with other strategic players in our sector."
- Bloomberg reported of Ctrip/Qunar merger talks back in 2014; antitrust approval of a deal could prove difficult, given the companies' combined Chinese online travel share. Since the time of Ctrip's offer, Ctrip has struck a deal to buy a 37.6% stake in smaller rival eLong, and has received a new $250M investment from Priceline.
- Also: Effective today, Qunar has terminated its Zhixin cooperation agreement with parent Baidu (NASDAQ:BIDU), through which Qunar ran an online travel marketplace for which Baidu promised to drive a guaranteed amount of traffic. SA author John Zhang has argued the deal was unfair to Qunar, noting (among other things) Baidu gets 76% of all Zhixin revenue beyond a "benchmark" level, and that Qunar has been paying Baidu huge sums for marketing services.
- Baidu has been given (and has exercised) warrants for 11.45M Qunar Class B shares (equal to 3.82M ADS, current value of $180M) for the traffic it drove. At the same time, Baidu is paying Qunar an RMB207M ($33.4M) termination fee.
- Meanwhile, Qunar has entered into a deal with Baidu (expires in May 2016, subject to renewal) through which "Baidu has agreed to grant Qunar an exclusive right to integrate hotel information and products into the PC and mobile app versions of Baidu Maps."
- On an RMB basis, Qunar is guiding for 105%-110% Y/Y Q2 revenue growth, a faster clip than Q1's 100%. The consensus is for 75.9% dollar-based growth.
- QUNR +2.3% AH to $47.05.
Mon, May 18, 3:10 PM
- Bloomberg reports Baidu (BIDU -0.8%) is teaming with top ride-sharing platform Uber and P-E firm Apax Partners to jointly bid for Nokia's (NOK +0.7%) HERE mapping/navigation software unit. Sources state the business could fetch as much as $4B.
- A rival group consisting of Chinese messaging/gaming giant Tencent (OTCPK:TCEHY), Chinese mapping firm/Tencent partner NavInfo, and Swedish P-E firm EQT Partners is also reportedly bidding. A group of German automakers (mentioned in past reports) and a trio of P-E firms are reportedly interested as well, and Microsoft (NASDAQ:MSFT) has offered to buy a minority stake.
- The next round of bids are reportedly due in 2 weeks. Baidu is said to be partnering with Uber to "avoid regulatory scrutiny." The NYT previously reported Uber has bid up to $3B for HERE, which has a dominant position in the in-car automotive market.
- Separately, Baidu has announced a "strategic investment" in content recommendation platform Taboola - readers may be familiar with the "Recommend for you" article boxes Taboola provides at the bottom of articles on partner sites. The WSJ reports Baidu, which plans to bring Taboola's platform to China, invested $20M-$30M.
Thu, May 7, 5:51 PM
- The NYT reports top ride-sharing platform Uber has bid "as much as $3 billion" for Nokia's (NYSE:NOK) HERE mapping/navigation software unit, thereby hoping to top a rival bid being prepped by German automakers and Baidu (NASDAQ:BIDU), and one submitted by a P-E firm.
- Bloomberg previously reported Uber and the automakers were among the firms to show interest in the business after Nokia began shopping it.
- Uber (valued at over $40B in a 2014 funding round) reportedly believes HERE and its proprietary data could further its efforts to provide logistics and ride-sharing services that require advanced geospatial mapping data - the company's apps currently rely on Google Maps. HERE's ~80% share of the in-car navigation system market could also be of interest.
- NOK +1.2% AH to $6.80.
- Earlier: Nokia, Alcatel-Lucent rally following Alcatel's earnings
Fri, Apr. 17, 5:59 PM
- With Google's Android Wear platform handicapped in China by the blocking of many Google services, Baidu (NASDAQ:BIDU) has launched DuWear, an Android-based smartwatch OS that comes with versions of Baidu's voice search and mapping apps.
- Much like Android Wear and Apple Watch, mobile payments support, motion tracking, and heart rate monitoring are also included. Baidu promises a "major manufacturer" will launch a DuWear watch in June. In the meantime, it's releasing a ROM that lets users (if they're interested) install the OS on Android Wear devices such as the Moto 360, LG's G Watch, and Sony's SmartWatch 3.
- Baidu also claims DuWear supports some 3rd-party Android Wear apps that don't use Google's mobile services framework. The OS launch comes a month after Baidu ended support for its Cloud OS Android smartphone ROM (had seen limited uptake).
- Separately, Baidu has acquired Anquanbao, a provider of cloud-based software that protects sites against malware and DDoS attacks. The startup's clients include Tencent and major Chinese domain name service providers.
- Baidu plans to use Anquanbao's software to improve load times for its sites and protect them from security threats. Anquanbao founder/CEO Ma Jie will head Baidu's cloud security ops.
Nov. 12, 2014, 8:04 AM
- Xiaomi (now China's biggest smartphone vendor and #3 worldwide) and Baidu (NASDAQ:BIDU) are each investing $300M in Baidu's iQiyi video site, China Business Daily reports.
- Meanwhile, Xiaomi has announced it's taking a stake in major iQiyi rival Youku (NYSE:YOKU) by acquiring shares on the open market. Xiaomi will also license content from Youku, and the companies will "jointly invest in the production and distribution of online video content and movies."
- The news comes a week after Xiaomi announced it's investing $1B to expand its Web video content library. The company claims 85M active users for its MIUI Android UI (pre-installed on its phones). Baidu/iQyi recently announced it would have distribution rights to 1K+ U.S. movies next year.
- Baidu, Youku, SOHU, and Tencent have been battling fiercely in a Chinese Web video market that features no dominant YouTube-like player for user-generated/short-form content, nor any dominant Netflix-like player for TV shows and movies. The market has seen huge mobile video growth: Mobile made up over 60% of Youku's Q2 video views.
- YOKU +3.6% premarket.
Oct. 10, 2014, 11:19 AM
- Baidu (BIDU -3.8%) has bought a majority stake in Peixe Urbano, Brazil's largest group-buying/daily deals site. Terms are undisclosed.
- Peixe Urbano claims 20M+ registered users (Brazil's total population is 200M), and 30K+ merchant partners. Its existing management will continue running the company as an independent unit.
- Baidu claims its services are already accessed by 50M+ Brazilian users daily, and has promised to invest R$120M ($50M) in the country over the next 3 years. In July, the company launched a Brazilian search engine (faces tough competition from Google), and unveiled plans for a local R&D center.
- Baidu already owns major Chinese daily deals site Nuomi (acquired from Renren). Shares are selling off on a rough day for tech stocks.
Aug. 27, 2014, 3:36 AM
- A 5B yaun ($813M) e-commerce joint venture between China's privately-held Dalian Wanda Group, Baidu (NASDAQ:BIDU) and Tencent Holdings (OTCPK:TCEHY, OTCPK:TCTZF) will be announced later this week, Reuters reports.
- The new venture will unite three of China's most powerful non-state companies, and will be 70% owned by Wanda and 15% held by Baidu and Tencent respectively.
- Wanda is a commercial property, luxury hotel and film conglomerate.
Jun. 11, 2014, 2:39 PM
- Acquisition-hungry Alibaba (ABABA) is buying the 1/3 of top Chinese mobile browser vendor UCWeb it doesn't yet own for a mixture of cash and stock. The price hasn't been disclosed, but Alibaba claims the deal is the biggest Chinese Web merger in history, exceeding Baidu's (BIDU +0.4%) $1.9B purchase of app store provider 91 Wireless.
- UCWeb has a 50%+ share of the Chinese mobile browser market, and also has 35% of the Indian market. The company claims 500M total browser users, as well as 50M users for its Android app store, which competes against Baidu and Qihoo's (QIHU +3.8%) popular stores.
- More importantly for Baidu (and also relevant for Qihoo), UCWeb claims a 20%+ share of the Chinese mobile search market on the back of 100M active users. A mobile search JV was launched with Alibaba in April.
- Meanwhile, CNBC reports Alibaba will likely file a new F-1 early next week that includes its Q1 results. Odds are Yahoo (YHOO +0.6%), which has been reporting Alibaba's results a quarter in arrears, will move on the numbers.
- CNBC adds Alibaba is still expected to go public in the first week of August. Bloomberg previously reported Alibaba is eying an Aug. 8 IPO.
Apr. 28, 2014, 10:17 AM
- Sohu (SOHU -4.8%) missed Q1 estimates and provided light Q2 guidance. Meanwhile, as part of a recent crackdown, the Chinese government has pulled The Big Bang Theory and other popular U.S. shows from sites such as Sohu.com, Youku.com (YOKU -4.4%), Baidu's (BIDU -5%) iQiyi, and Tencent Video (TCEHY -2.8%). Time observes The Big Bang Theory has produced 1.3B video views since launching on Sohu TV in '09.
- The news is overshadowing a $1.22B investment in Youku by Alibaba (ABABA) and an affiliated P-E firm, and a WSJ report stating Alibaba is forming a mobile search JV with leading mobile browser firm UCWeb (once targeted by Baidu).
- The deals are the latest in a long line of investments and partnerships struck by Alibaba, Tencent, and Baidu, as each firm tries to build a Web/mobile empire covering over a dozen valuable markets.
- Is Qihoo (QIHU -0.8%) next in line to make a deal? With a $21.6B market cap, the security app/browser/search provider and Baidu rival is the biggest Chinese Internet company to remain independent of the big-3. Qihoo was reported in January to be talking with Alibaba.
- Other decliners: NQ -6.5%. VIPS -5.2%. WB -4.2%. WBAI -3%. LONG -4.5%. QUNR -2.4%.
Apr. 8, 2014, 9:37 AM
- Bloomberg reports leading Chinese travel sites Ctrip (CTRP +5.4%) and Qunar (QUNR +5.4%) are "discussing a range of possibilities, from a full-blown merger to a partnership."
- Sources caution the talks are at an early stage, and that ownership structure and financing haven't yet been agreed upon.
- With combined 2013 sales of more than $1B, a Ctrip-Qunar merger would create a Chinese online/mobile travel powerhouse ... provided regulators don't object. The companies have been aggressively battling for mobile customers, sacrificing margins in the process.
- Ctrip and Qunar are both rallying. Rival eLong (LONG +1.9%) is also higher amid positive early trading for recently-pressured Chinese Internet stocks.
- Baidu (BIDU +1.8%) owns 58.6% of Qunar, which delivered a strong IPO last year.
Jan. 24, 2014, 10:59 AM
- Five months after Baidu (BIDU -0.4%) acquired a 59% stake in Chinese daily deals/group-buying site Nuomi from Renren (RENN +2.2%) for $160M, Renren says it has reached a deal to sell its remaining stake in Nuomi to Baidu. Terms are undisclosed. (PR)
- Following Baidu's initial purchase, Nuomi's CEO wrote a memo stating his company is looking to eventually go public. The company has been estimated to hold an 11.6% share of the Chinese group-buying market (#4 overall).
- Nuomi is just one of several acquisitions Baidu has made over the last two years to grow the reach of its Web/mobile empire.
Dec. 27, 2013, 1:21 PM
- Making good on a November Marbridge Consulting report, Baidu (BIDU +4.1%) has reached a deal to acquire Perfect World's (PWRD +1.8%) Huanxiang Zongheng online literature business (provides Chinese e-books, digital comics, and animations) for RMB191.5M ($31.5M). (PR)
- Marbridge previously noted Zongheng offers 100K+ e-book titles, receives 60M+ daily page views, and gets over 1/3 of its site traffic via mobile.
- The purchase is the latest in a string of 2013 acquisitions by Baidu, as the Chinese search giant attempts to create a far-reaching empire of Web/mobile content and services. Prior acquisitions: PPS, 91 Wireless, Nuomi.
- Perfect World says the deal will allow it to focus on its core online gaming business. The company has been investing heavily in both developing new games and promoting existing ones.
Nov. 21, 2013, 7:04 PM
- A source close to Baidu (BIDU) tells Marbridge Consulting the Chinese search giant is close to buying Chinese literature/comics/animation site Huanxiang Zongheng, a unit of online gaming firm Perfect World (PWRD). The source adds more info about the deal will be released on Nov. 26.
- Zongheng offers 100K+ online book titles, and receives 60M+ daily page views. It also offers iOS, Android, and Windows Phone apps, and gets over 1/3 of its site traffic via mobile.
- Baidu has stepped up its M&A activity this year, as it tries to evolve into a broader, Google-like provider of Internet services and apps. The company has already bought video site PPS and top Android app store 91 Wireless, and a 59% stake in daily deals site Nuomi.
Sep. 16, 2013, 11:44 AM
- Though Tencent's (TCEHY.PK, TCTZF.PK) acquisition of a 36.5% stake in Sohu's (SOHU +6.9%) Sogou search unit stands to make Sogou a greater threat to Baidu (BIDU +2%), given Tencent's plans to promote Sogou throughout its messaging/gaming empire, Baidu investors appear relieved Qihoo, which was in talks with Sohu, didn't end up reaching a deal.
- Research firm CNZZ recently estimated Qihoo now has over 15% of the Chinese search market, and the company itself recently pegged its share at 20%. Acquiring Sogou (estimated 8.8% share) would've given Qihoo additional scale and resources as it challenges Baidu's dominant position.
- Meanwhile, Tencent rose 2.5% in Hong Kong overnight, before the Sogou deal was announced. The company's market cap has topped $100B.
- Chinese Web giants Baidu, Tencent, and Alibaba are increasingly stepping on each others' toes. While Tencent and Alibaba have been relying on partnerships/minority investments to grow their reach, Baidu has been more interested in acquisitions and controlling stakes.
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