ChinaTravelNews Briefing: Tencent vies for railway WiFi service, Meituan denies funding and more
Both Tencent and Alibaba are eyeing a stake in Bullet Train Networks, Ctrip joins a consortium in a bid for car rental firm eHi’s privatization, and more in this week’s Briefing.
Chinese social media giant Tencent Holdings will bid for a stake in Bullet Train Networks, a company that provides WiFi services on China’s high-speed railways, in a deal worth more than USD 485 million. Tencent’s rival Alibaba Group has also shown interest in the deal.
Ctrip, an existing shareholder of rental firm eHi Car Services, has joined hands with private equity firm Ocean Link in a non-binding proposal of eHi’s "going-private" transaction.
Hotel tech firm Shiji Information has asserted that it will acquire the majority stake of Baoku Online to further gauge the digital and offline footprint of consumers.
This investment would complement Shiji’s existing competencies in PMS, POS, and destination and retail solutions. By tapping into the travel management space, the company would incorporate data that is related to “work” or “business travel”.
Hainan Airlines is mulling the purchase of major hotel and aviation assets from its parent HNA Group and independent third parties, including several domestic airlines and an overseas hotel operator.
Overseas assets would account for 48%-65% of all outlays involved in the overhaul, according to Hainan Airlines.
China will support the development of horse racing and other projects including beach and water sports in Hainan. Hainan will also adopt more liberal duty-free shopping policies, boost international flight frequency and prioritize tourism.
Hainan’s move could pose challenges to the USD 33 billion casino industry in Macao and other casino hubs in Asia. The effect may reverberate throughout the global travel industry.
Meituan Dianping was reported to be in talks to raise USD 3 billion to pave the way for its HongKong IPO, as it has been expanding its promising ride-hailing service. However, Meituan CEO Mr. Xing Wang refuted reports of future funding and declined to comment on its IPO timeframe.
Hotel and customized travel statistics
According to the 2018 Chinese Hotel Chain Development and Investment Report, China’s hotel industry is expected to continue to expand in 2018, and the industry will gross some USD 796 billion in revenues from accommodation and F&B services. Catering alone is expected to show sustained growth of 10% and contribute 4.4 trillion yuan.
Among the Top 50 China Hotel Groups, Jinjiang International Hotels Group topped the list with 6,794 hotels and 680,000 rooms, while BTG Homeinns Hotels Group and China Lodging Group (HUAZHU Hotels Group) are in the second and the third place, each with 384,743 and 379,675 rooms respectively.
Ctrip saw a 130% year-on-year increase from 2016 to 2017 in the number of Chinese travelers taking customized tours to Europe. It reflected that more Chinese travelers to Europe were opting for unique, personalized and thematic travel experiences, according to an industry report jointly released by Ctrip and China Outbound Tourism Research Institute.
The report showed that 40% of China’s customized travel was outbound, and Europe accounted for 10%. On average, customized trips to Europe lasted around 12 days covering no more than two countries, and the expenditure was at least 2,500 yuan per person, per day.
Rural holiday service operator Xband Club (Xiangban Culture Tourism) raised RMB 63.5 million from a tourism fund jointly set up by CYTS, IDG Capital and Sequoia Capital.
After the capital injection, the company plans to build an inventory of 10,000 guest rooms in five years, and operate 500 countryside resorts in the next 10 years.
B2B travel platform Octopus completed its USD 95 million strategic financing. New investors include Alipay parent company Ant Financial and CCB International.
Octopus launched its first domestic long-haul brand Fei Yu last month, featuring a direct connection to destinations, ground mobility options and a real-time superior supply chain for resource integration.
Shenzhen-based B2B hotel resource consolidator DidaTravel secured USD 8 million in funding jointly backed by Shenzhen Capital and Guolong Capital.
DidaTravel CEO Mr. Weilve Wu said: “Compared to having 80% of its total turnover from OTAs two years ago, DidaTravel’s current sales volume is generated equally through domestic OTAs, domestic offline merchants and overseas merchants (OTAs, travel agency groups, travel agency outlets).”
Film Hotel raised USD 16 million in its A round of financing. The round had IDG Capital as lead investor and was backed by Buhuo Ventures. The founding team also contributed more than RMB 30 million (USD 4.78 million).
Film Hotel aims to differentiate its brand from other mid-range hotel chains with a crossover of “Films + Hotels”. Its goal is to revamp economy hotels in the market by adding cultural and technological elements.
Islands, an urban shared lodging startup, brought in tens of millions of yuan in its A round of financing. Banyan Capital was the lead investor and Plum Ventures also participated.
The company has turned regular rooms into spaces for travel photography and comfortable lodging. Guests can rent a room by the hour according to personal needs, so as to make use of a room at a preferential rate when it’s not occupied.