Baidu Inc (NASDAQ:BIDU) is divesting one-third of the stake worth $1 billion in an online travel site – Ctrip to counter the slowdown in the economy. The company would focus on its advertising business. According to an announcement by Ctrip on Thursday, it is offering Baidu’s holding of 31.3 million shares through a secondary market. It accounts for a 30% stake in Ctrip and valued at $1 billion based on the current market price.
The largest shareholder in Ctrip
Following the latest sale, Baidu is still the biggest shareholder in Ctrip. Baidu holds a stake of 19% in Ctrip after the exchange of shares in Qunar, a rival travel service, in 2015. It helped to form the most significant travel service in China and put a brake to the price war.
Baidu would use the proceeds of the stake sale for operational expenses because of competitive and macroeconomic pressures. It may also use the funds for buy-backs. The company has divested food delivery service to Ele.me of Alibaba Group Holding Ltd (NYSE:BABA) in the previous years. It also merged the music streaming service with Taihe, a record label in China, to concentrate on autonomous cars, smart speakers, and advertising. Baidu recently forayed into the content to retain and attract the users and supporting Zhihu, and Q&A, the prominent social media platforms.
Commercial license for a self-driving bus
Baidu received a commercial license for the self-driving bus in China. However, it is for trial purpose only. The company plans to offer the self-driving bus service on public roads (28km) of Wuhan.
Baidu demonstrated self-driving buses in Wuhan, China in 2018 and moved closer to commercialization. The buses operate at a speed of 15 km/hour along a 5 km stretch. It has put in place the safety staff to halt the buses in case of an emergency.
Baidu developed the self-driving buses for commercial transport in coordination with King Long United Automotive Industry Co. Self-driving buses does not have steering wheels. It has already built 100 self-driving buses. According to the C.E.O. of Baidu, Robin Li Yanhong, it will run the self-driving buses in Shenzhen, Xionzhen, Beijing, and Tokyo. The buses will operate using 5G service.