However, in an earnings report Qunar released on Tuesday, Qunar made a surprising statement about its relationship to Ctrip, whose acquisition offer it refused last month
Qunar, one of China’s biggest travel booking sites, announced on Tuesday that it has secured a strategic round of funding worth $500 million led by Silver Lake, a global tech investment firm.
Silver Lake invested $330 million, while the remaining $170 million was contributed by a second unnamed investor. Qunar said in a statement it will use the money to expand its mobile presence, grow its business lines, and enhance its technology.
The company listed on the NASDAQ in November 2013, when it raised $167 million. It hasn’t made a profit since the IPO.
Qunar doubled its revenues in the first quarter of 2015 compared to the same period last year for a total of $108.3 million, according to the company’s first quarter earnings report released today. Revenues from mobile devices represented nearly 60 percent of that.
The company’s biggest source of revenue is flight bookings, followed by hotel reservations.
Ctrip merger still on the table
Last month, China’s largest online travel booking company, Ctrip, offered to acquire Qunar. Qunar included its response in today’s earnings report to quell rumors: “After careful consideration of such offer, we declined to pursue it in a letter response dated June 1, 2015. However, consistent with our policy to consider all potential strategic opportunities that may benefit our company and our shareholders, we remain open to engaging in further discussions with Ctrip as well as with other strategic players in our sector.”
One of Ctrip’s biggest investors is Tencent, the maker of WeChat and the second biggest internet company in China by market cap. Qunar is a portfolio company of Baidu, another giant that runs China’s most popular search engine. Both Baidu and Tencent, along with Alibaba, make up the trifecta of Chinese web titans that largely shape the course of the country’s internet.
Ctrip last month purchased a $400 million stake in Elong, another popular flight and hotel booking service in China. Those shares were purchased from U.S.-based Expedia, which sold its $671 million majority stake in the company. Expedia’s biggest rival, Priceline, owns a 10 percent stake in Ctrip, which it bought for $500 million last year.
If Ctrip were to acquire Qunar, it will have absorbed all but the smallest contenders in China.
Editing by Steven Millward
This post was originally published on Tech in Asia.
Featured Image Credit: World Travel & Tourism Council / Flickr