Ctrip, eLong Shares Are Booming After 'Strategic' Stake Revealed

Ctrip.com International, Ltd.CTRPannounced a "strategic" investment in eLong, Inc. LONG by acquiring shares from existing shareholders, including Expedia Inc EXPE and others. China-based Ctrip is a leading travel service provider of accommodation reservation, transportation ticketing, packaged tours, and corporate travel management in China. eLong is a leader in mobile and online accommodations reservations in China with a portfolio of nearly 510,000 properties worldwide. Expedia is a U.S.-based online travel company with a portfolio of hotels across 200 countries. Ctrip's share acquisition resulted in the company owning a 37.6 percent equity stake in eLong for a total purchase price of approximately $400 million. Ctrip and Expedia also agreed to cooperate with each other to allow their respective customers to benefit from certain travel product offerings for specified geographic markets. In a separate press release, eLong confirmed that Expedia has sold its entire 62.4 percent ownership stake in the company at an average price of $29.27 per ADS to several purchasers based in China, including Ctrip along with Keystone Lodging Holdings Limited, Plateno Group Limited and Luxuriant Holdings Limited. Shares of Ctrip jumped higher by more than 5 percent during Friday's pre-market trading session to $76.00, marking a new 52-week high for the stock. At the same time, shares of eLong surged more than 34 percent and were seen trading at $27.70, also marking a new 52-week high. Shares of Expedia were showing no trades in the pre-market session