Baidu inc. (Nasdaq: BIDU) will sell about 30 percent of its stake in Ctrip.com (Nasdaq: CTRP) International Ltd., which amounts to around $1 billion.
The Chinese search engine giant, plans to sell 31.3 million American depositary shares, which represents 0.125 per ordinary shares in Ctrip, China’s largest travel agency said in a statement on Thursday. Underwriters will receive a 30-day option to purchase an additional 4.69 million in ADSs, Ctrip said in its statement.
Baidu, has maintained a stake with Ctrip, since the launch of the share exchange agreement in 2015. Baidu now owns a 19 percent stake in Ctrip, according to Reuters.
Despite Baidu having a market share that exceeds 70 percent, according to a Forward Industry Research Institute report, cited by Nikkei Asian Review, its struggling with tighter government regulation and the effects of the trade war has hurt advertising revenue, Reuters reported.
In August, Baidu invested in the Beijing-based tech platform, Guoke Interactive and Zhihu, China’s largest questions and answers platform.
"It's a strategic move for Baidu," Yu Xue, a tech analyst at market research firm IDC, according to Reuters.
Xue also said Baidu is pulling away from businesses similar to Ctrip, that deal with connecting online customers to offline services such as, hotels and building its own content ecosystem, according to Reuters.
Baidu said in a separate statement it began using its robo-taxi pilot service of 45 vehicles in Changsha, the capital of central China’s Hunan province, on Thursday. The automated taxis will include intelligent self-driving functions such as, changing lanes with road and traffic conditions taken into account, and automatic avoidance when sensing movements of nearby vehicles, Baidu said in its statement.
In addition Nikkei Asian Review reported Baidu won the first commercial license in China for a self-driving bus, on Thursday. Baidu’s stock traded up 2 percent, at 104.35 per share Thursday morning.