Baidu Missed Out on Kingsoft Network Investment; Tencent invests USD 46.98 million In US 52 million Round
By ALEX HSU
A source close to the deal in which Tencent increased its stake in Kingsoft Network to 18% said that Tencent paid USD 46.98 million for the new shares. Kingsoft Corporation invested an additional USD 5.22 million. The deal closed on June 25th and values private Kingsoft Network at USD 500 million.
Since January, it has been rumored that Baidu would be making an investment in Kingsoft Network. The source confirmed that Baidu has been in touch with Kingsoft, but said that Baidu’s offer was declined because there were too many strings attached: “Baidu usually demands control of the company, but some management teams are unwilling to take such conditions.” Bao Fan, CEO of Huaxing Capital, said “Baidu’s investment decision making process is slow compared to other Chinese internet giants.” Huaxing Capital was the financial advisor for PPS, a company recently acquired by Baidu.
Tang Hesong, director of Baidu’s enterprise development said: “Baidu will be looking for other ways to cooperate with Kingsoft Network.”