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Ibibo will sell 50% to Tencent Holdings

Ibibo will sell 50% to Tencent Holdings
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First Published: Wed, Jun 25 2008. 11 49 PM IST
Updated: Wed, Jun 25 2008. 11 49 PM IST
New Delhi: The subsidiary of Cape Town, South Africa-based multinational media firm Naspers Ltd, MIH India Global Internet, which owns social networking site ibibo.com, will sell up to 50% stake in five years to China’s Tencent Holding Ltd Inc., an instant messaging service provider owned 36.1% by Naspers.
Tencent has already put in $7.5 million (Rs32.10 crore) for an undisclosed stake in ibibo Web Pvt. Ltd, the company that manages three India-based websites—ibibo.com, OneFamily.com and Dwaar.com.
“This partnership allows us to benefit from Tencent’s expertise in providing Internet and mobile value-added services, as well as online advertising services,” said Ashish Kashyap, chief executive officer at ibibo Web.
Naspers has invested 103 million rand (Rs55 crore) in India “to develop the greenfields social network services and local search operation, ibibo”, according to information on its website.
Besides ibibo, Naspers’ interests in India include a 30% stake in ACL Wireless Ltd, a mobile software developer.
As part of the deal, Tencent, which owns QQ, an instant messaging and communication tool, will give ibibo.com access to its products and technologies.
Through QQ, Tencent has 318 million active user accounts in China as of March. “The deal is our initial attempt to explore opportunities in an emerging market,” said Catherine Chan, a spokesperson for Tencent, by email.
“This is a good consolidating move for ibibo, which is all about connectivity and instant messaging. Technology is ubiquitous and ibibo will only stand to benefit through infusion from other technologies,” said Balendu Shrivastava, market research firm IMRB International’s group business director of the business and industrial research division.
“We view this deal as a part of a deliberate long-term strategy of securing strategic stakes in leading private companies that, like India, will likely become important Internet markets in Asia,” says an 18 June report by Citi Investment Research, a division of Citigroup Global Markets Inc.
Around 73% of Naspers revenues come from South Africa. For the year to March, its Internet revenues grew 42% to 1.6 billion rand.
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First Published: Wed, Jun 25 2008. 11 49 PM IST
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