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Beijing - Tencent, one of China's biggest internet companies, is set to announce a deal on Wednesday to purchase a 20% stake in restaurant ratings and group buying website Dianping.com for $400m, China Business News reported on Monday.
Tencent, in which Naspers owns a large stake, holds the option to buy another 5% of Dianping within a year when the latter launches its initial public offering overseas, the report said.
Competition has escalated among BAT, the acronym for China's three internet giants. The other two are the leading search engine Baidu and e-commerce group Alibaba.
All three are seeking growth through the expansion of O2O (online to offline) services.
On February 10 Alibaba offered $1.1bn to acquire AutoNavi Holdings, making the Chinese digital mapping and navigation firm its wholly owned subsidiary.
Given Alibaba's previous deals with group buying website Meituan.com and taxi-calling app Kuaidi, analysts predict strong O2O performance from the company.
Baidu is expected to fare well too in the 020 sphere thanks to its alliance with Meituan's rival Nuomi.com and online app store 91 Wireless.
Wednesday's deal between Tencent and Dianping is believed to benefit both companies.
The former can reap more revenues from bricks and mortar stores, while the latter will gain a wider public exposure due to Tencent's large user base, especially in its trending instant message app WeChat.
Tencent shares increased 5.7% to HK$580 in Hongkong.
* Fin24 is part of Media24, a subsidiary of Naspers.
Tencent, in which Naspers owns a large stake, holds the option to buy another 5% of Dianping within a year when the latter launches its initial public offering overseas, the report said.
Competition has escalated among BAT, the acronym for China's three internet giants. The other two are the leading search engine Baidu and e-commerce group Alibaba.
All three are seeking growth through the expansion of O2O (online to offline) services.
On February 10 Alibaba offered $1.1bn to acquire AutoNavi Holdings, making the Chinese digital mapping and navigation firm its wholly owned subsidiary.
Given Alibaba's previous deals with group buying website Meituan.com and taxi-calling app Kuaidi, analysts predict strong O2O performance from the company.
Baidu is expected to fare well too in the 020 sphere thanks to its alliance with Meituan's rival Nuomi.com and online app store 91 Wireless.
Wednesday's deal between Tencent and Dianping is believed to benefit both companies.
The former can reap more revenues from bricks and mortar stores, while the latter will gain a wider public exposure due to Tencent's large user base, especially in its trending instant message app WeChat.
Tencent shares increased 5.7% to HK$580 in Hongkong.
* Fin24 is part of Media24, a subsidiary of Naspers.
