China’s biggest travel booking sites are taking to the skies. Hot on the heels of Qunar’s plan to launch an airline alongside unnamed partners leaking out, close frenemy Ctrip has announced a 3 billion CNY ($463 million) investment in China Eastern Airlines, a state-run airline that claims 94 million passengers.
14-year-old China Eastern Airlines operates domestic and international flights, serving 1,052 destinations in 177 countries. One of three major state-owned airlines in China, its parent company is listed on the Shanghai Stock Exchange, Hong Kong Stock Exchange and New York Stock Exchange. Ctrip, which pulled in $1.7 billion in revenue and a $387 million net profit in 2015, said its investment would consist of a private placement of shares.
The deal is part of a wider cooperation between Ctrip and the airline, which say they will team up on “low-cost transportation solutions, international air travel, IT technology, travel insurance, and e-commerce.” Ctrip has taken a board seat via its investment, and it said in a statement that it may increase its shareholding over the next twelve months.
This deal is the second major investment Ctrip has made this year, having poured $180 million into India’s MakeMyTrip in January. This new focus on investments comes after Ctrip agreed to a share swap with Qunar, its biggest rival, back in October of last year. Qunar rejected an offer from Ctrip in the summer of 2015, when it raised $500 million in fresh capital, but months later it relented with this agreement as Baidu, its majority investor, agreed to give Ctrip a 45 percent voting interest in Qunar in exchange for 25 percent of Ctrip.