Internet giant Tencent Holdings Ltd. (00700.HK) has agreed to acquire 20 percent stake in Shanghai-based Dianping.com, a food and entertainment guide and user review website, signaling its ambition to build China’s biggest online to offline (O2O) business.
Internet users can share their consumption experiences and receive service content from multi-platforms as Tencent and Dianping.com join forces. At the same time, the alliance will enable merchants to secure O2O solutions on the mobile internet, Tencent said Wednesday. The two platforms will gain more “stickiness” as the two companies enhance their strategic cooperation.
“With the strategic cooperation with Dianping.com, we can enhance the experience for mobile users as they can enjoy online to offline service through our social media platforms such as QQ and WeChat,” Tencent’s president Martin Lau said. Zhang Tao, chief executive of Dianping.com, said he hopes to speed up his firm’s expansion plans, especially to third and fourth-tier cities.
Dianping.com will keep its management team in order to maintain the company’s individual operation and development even after the Tencent deal.
The deal is expected to intensify competition among the big three Chinese internet players—Baidu (BIDU.US), Alibaba and Tencent (00700.HK), known collectively as BAT— in the O2O market, observers say.
Alibaba feels it has the upper hand with its Alipay and mobile Taobao e-commerce site. Tencent, on the other hand, gains advantage through its instant messaging application Weixin and Weixin Payment platform. Baidu’s ace is its location-based services.
CIRC lifts insurers’ equity investments cap to 30%
The China Insurance Regulatory Commission (CIRC) said on Wednesday that it will allow insurers to park up to 30 percent of their total assets, valued as of the end of the most recent quarter, in equities, Shanghai Securities News reported Thursday. The firms can invest in stocks, stock funds, hybrid funds, private-equity funds and equity of private companies. Previously the permitted ratio was at 25 percent. Meanwhile, investment ratios on real estate, other financial assets and overseas investment have been capped at 30 percent, 25 percent and 15 percent respectively.
Sinopec to introduce private capital in sales
China Petroleum & Chemical Corp. (Sinopec) (600028.CN, 00386.HK) has approved a restructuring of its oil sales business to allow private capital, according to a regulatory filing Wednesday. In a unanimous vote, the board agreed to diversify the ownership of the business by introducing social and private investment based on market conditions. Such investment, however, should not exceed 30 percent. The restructuring is in line with a broader effort to reform the country’s state-owned behemoths.
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