Baidu Inc announced plans to acquire stakes in NetDragon Websoft Inc's 91 Wireless. The deal was estimated at US$1.09 billion. The Chinese search engine giant plans to acquire a major stake in the app store in its goal to stake a greater claim of the market for mobile users.
A binding memorandum of understanding was signed between Baidu and NetDragon Websoft Inc. for a 57.4% stake claim for 91 Wireless. Baidu will also buy share held by other investors, as part of the deal.
Andy Yeung, analyst for Oppenheimer & Co Inc in New York, said, "Baidu is not as well established in the mobile Internet space as the desktop Internet space. It's a complementary strategy to enhance Baidu's status in the mobile ecosystem."
With the competition intensifying with the Alibaba Group Holding Ltd., Baidu is set to stake a bigger claim in mobile apps. Baidu held 82% desktop searches in China as of the end of March. Its mobile app only tapped 9% of the 1.16 billion wireless subscribers in China as of April.
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