Tencent Acquires 11% of Mapping Firm NavInfo for $187 Million.
Tencent has decided to step up their game against Alibaba, its closest competitor in China’s Internet space, after recently securing a deal to purchase 11.3 percent stake in Chinese mapping service NavInfo for a total of .1.17 billion yuan ($187 million.
NavInfo provides digital maps, a location-based vehicle network, dynamic traffic information and other services. It has boasted to be the fourth largest company company that of its type globally.
Announced in a filing that was found by Bloomberg, the deal is seeming a response towards Alibaba’s $1.5 billion deal to purchase Autonavi, a much larger rival to NavInfo, which was previously announced during April. Its closing in on one year from the day that Alibaba had first invested in Autonavi, dishing out a total of $294 million for an Initial 28 initial percent share.
This deal is a countermeasure move against Alibaba when it comes down to location based services, and its possible that NavInfo services will be integrated into Wechat, Tencent’s mobile messaging application, which claims to have 355 million active users worldwide, most of them who are located in China. Tencent has recently invested in Dianping as well, a service that as known as the Chinese version of Yelp, which has already been integrated into Wechat, and that appears to be main goal for many of its recent investments.
WeChat has gone beyond the basic mobile messaging application by offering games, an built-in marketing channel, and even a e-commerce service like flight book. Alibaba has its own competing messaging application and despite gaining an impressive early growth as Alibaba staff were told to download it, it’s mostly still behind WeChats numbers.