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Tencent To Buy 11.3% Stake In Mapping Company NavInfo For $187M

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Tencent, one of China’s largest Internet companies, will spend 1.17 billion yuan, or $187 million for a 11.3% stake in NavInfo, one of the country’s largest mapping companies.

Best known abroad as the maker of WeChat, Tencent’s products in China include a large range of consumer mobile products and NavInfo will help power its location-based services.

The deal is notable because Tencent’s rival Alibaba Group, which is prepping for its massive IPO, recently bought mobile mapping provider AutoNavi Holdings, one of NavInfo’s main competitors. AutoNavi powers Alibaba’s location-based e-commerce mobile services, as well as other navigation offerings, including map engines, location search, and cloud computing services.

Alibaba first became a major stakeholder in AutoNavi in May 2013. At that time, Alibaba did not have its own standalone map service, unlike rivals Baidu and Tencent, which meant it had a gaping hole in its product roster.

Tencent will buy 78 million shares from NavInfo’s owner, state-run China Siwei Surveying and Mapping Technology Corp. The deal will make Tencent the second-largest shareholder of NavInfo.

As TechNode (TechCrunch’s partner site in Shanghai) puts it, NavInfo is “one of the veteran mapping companies in China, starting off with business-facing mapping data business” and began to focus on consumer products last year.

NavInfo may be used to power Tencent’s mapping apps, streetview products, and Lubao Box, a navigation device for drivers.

Tencent and NavInfo announced the deal in a Shenzhen Stock Exchange filing, which was first reported by Bloomberg.

Photo from Flickr user SEDACMaps used under a Creative Commons 2.0 license