In its bid to bolster location based services, Tencent Holdings Ltd has acquired a 20% holding in the owner of Dianping.com, an online review site, Bloomberg reported.
A filing in the Hong Kong stock exchange showed that the new stakes in Dianping Holdings Ltd will be bought by Huai River Investment Ltd, a subsidiary of the Chinese company. Up to $500 million could be invested by the biggest Internet firm in Asia into Dianping, the report said citing a February 17 report from Sina.com which did not give sources.
With the purchase, Tencent will have access to the close to 100 million active users a month of China-based Dianping. These users visit the website to look at reviews about and get discounts to restaurants and entertainment-related offers. Based in Shenzhen, China, Tencent is going neck-to-neck with Alibaba Group Holding Ltd in the field of location-based services. The two firms are vying provide users with food, shopping and leisure services to a rapidly growing mobile Internet market. In 2013, there were 500 million users who used mobile phones to gain Internet access, the report said.
Dianping.com is the biggest website in China that offers location-based food and entertainment services. It operates like Yelp Inc and Groupon Inc in the US. Yelp Inc allows site visitors to get reviews and information about local businesses in the US and Canada while Groupon Inc gives information about local goods, services and events all over the world, guiding them on what attractions to see, things to do, what to eat and places to shop in. Yelp is listed in the New York Stock Exchange while Groupon is on the Nasdaq, Bloomberg data showed.
Sequoia Capital Operations Llc and Lightspeed Venture Partners are the backers of Dianping.com. It launched in Shanghai in 2003. Dianping.com provides business search services, including reviews from customers that have already tried out the establishments, Bloomberg reported.
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