Zhejiang Geely Holding Group and Tencent Holdings have won a joint bid for 49 percent stake in a China Railway Corp subsidiary that provides Wi-fi services on high-speed trains in the country.
The stake acquisition in High Speed Network Technology Co. will lead to a three-way partnership between that firm and Geely and Tencent, Reuters reports.
Geely did not disclose the value of the joint bid, but information available on the China Beijing Equity Exchange suggests the deal was worth some 4.3 billion yuan (US$672 million).
High Speed Network Technology was established in late 2017 by China Railway to provide wireless internet services on high-speed trains across the country.
Geely is said to be taking 39 percent stake in new joint venture, while Tencent will hold 10 percent.
According to China’s Xinhua news agency, the joint venture will boost Wi-fi hotspots throughout the high-speed rail network across the country and develop an online platform that offers ticketing, shopping, tourism and catering services.
The initiative forms part of a wider move towards creating a smart and intelligent transportation network in China.
Wi-fi access is already available on China’s “Fuxing” bullet trains on the Shanghai-Beijing line.
Tencent boss Pony Ma told mainland media that “digital era in China is undergoing a period of change and opportunity. Tencent hopes to become a digital assistant, where it will share its spirit of ‘digital craftsmanship’ to help everyone achieve a transformation and upgrade themselves digitally.”
Li Shufu, president of Geely, told Caixin that by participating in the Wi-fi project, Geely is seeking to expand into the “smart mobility” area.
China has claimed to have the fastest growing rail network and trains throughout the world. In 2017, a total of 3.04 billion passenger trips were made on railways, and more than 56 percent of those trips were made on high-speed trains.
Some 4,000 kilometers of new tracks are planned to be put into operation in this year, according to the nation’s railway operator.
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