Domestic Internet giants are on a merger and acquisition spree as the nation is moving fast into the mobile era, reports Meng Jing
Would you consider buying a startup with just 50 employees for $19 billion? Mark Zuckerberg, co-founder and chief executive officer of Facebook Inc, the world's largest social network, did just that in late February.
The real motivation for the lofty price was the fast-growing mobile messaging service called WhatsApp.
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Chinese Internet giants are also engaged in an acquisition spree as the country's Internet industry rapidly shifts from the personal computer to the smartphone.
So far this year, domestic Internet companies have spent about $2.5 billion on acquisitions and strategic investments, according to Citi Research, a division of Citi Group Inc.
The total isn't impressive compared with Facebook's deep pockets, but the participants are drawing lots of attention.
The three Chinese Internet giants - Baidu Inc, Tencent Holdings Ltd and Alibaba Group Holding Ltd - have been competing with one another for prime acquisitions to fill gaps in their businesses.
With almost a half-billion people in China using mobile phones to access the Internet, it's a new era, and the three know that.
Some of the latest deals:
In late January, Baidu bought out the group-buying site Nuomi Holdings Inc from Renren Inc, expanding its e-commerce offerings.
On Feb 10, Alibaba offered to buy out mapping service AutoNavi Holdings Ltd to compete head-to-head with Baidu's mobile map app. The deal valued AutoNavi at $1.6 billion.
Nine days later, Tencent announced it would to take a 20 percent stake in Dianping, China's best-known restaurant rating and reviews website, which also offers a group-buying service.
Citi Research has forecast the trio will drive Internet-related deals in China to a record this year.
That buying binge will add to their 44 announced acquisitions since 2012 valued at $18.7 billion, according to data compiled by Bloomberg News.
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