Skift Take

The Group deal is both a shocker and a non-shocker. When Ctrip decided to change the parent company name to Group, you could see a certain affinity with the TripAdvisor brand. On the other hand, Booking Holdings has been Ctrip's longtime best friend in China.

TripAdvisor and Group, the China-based online travel agency formerly known as Ctrip, entered into a global joint venture.

Under the terms of the deal, the two companies formed a global joint venture under the TripAdvisor brand in China, and there are also global content-licensing agreements where Group brands, including Ctrip,, Qunar, and Skyscanner, would distribute TripAdvisor content.

There is also a governance component to the deal: Group will be able to nominate one person to the TripAdvisor board.

The joint venture, which will be called TripAdvisor China, will have TripAdvisor owning a 40 percent chunk and will furnish Group with exclusive rights to its Chinese brand, content license, and other assets of that business. Group is the majority shareholder of the joint venture. Both companies agreed to share inventory in the joint venture.

To get the board seat on TripAdvisor, Group would acquire 6.95 million shares of TripAdvisor, or TripAdvisor shares valued at $317.6 million through open stock market transactions within one year following regulatory approvals. Liberty TripAdvisor Holdings, which is the controlling shareholder of TripAdvisor, separately agreed to provide Group with information rights regarding the sale of preferred TripAdvisor Class B share and Liberty TripAdvisor Holdings shares.

In a joint statement, the companies said the deal helps Group with its globalization goals and strengthens TripAdvisor’s stature as a global leader in travel.

“We are pleased to announce this strategic partnership with Group to expand TripAdvisor’s global reach and also help outbound Chinese travelers plan more meaningful trips,” said Stephen Kaufer, TripAdvisor CEO. “China is one of the largest and fastest growing travel markets in the world. Group, with its established brands and travel market leadership, is the perfect partner to help us achieve our long-term goals in the region.” Group CEO Jane Sun pointed to TripAdvisor’s user reviews and photos as a benefit of the deal, adding the agreements will help with its global growth and vision to serve the needs of its customers worldwide.

TripAdvisor stated as part of scripted comments about its third-quarter financials that it doesn’t expect the deal to have a significant impact on its ongoing financial results.

The Group-TripAdvisor deal for the joint venture and Group’s potential investment in TripAdvisor and its controlling shareholder, Liberty TripAdvisor Holdings, come despite the fact that Booking Holdings has had a several-year strategic partnership with — and investment in — Group.

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Tags: ctrip, m&a,, tripadvisor

Photo credit: TripAdvisor and Group announced a joint venture. TripAdvisor

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