US travel agency Priceline buys into Ctrip for China push

Priceline, the biggest online travel organization in the US, invested US$500 million in Ctrip(.)com International to widen the organizations’ options in China.

Priceline and Ctrip, which have had a commercial partnership since 2012, will increase their cross-promotion of each other's hotel inventory and other travel services, the companies said.

Ctrip, China's biggest travel website, is expanding its hotel-booking business as sales increase. Chinese revenue per available room rose 7 per cent in May, the highest growth since 2010. Ctrip's total sales climbed 38 per cent to about US$276 million in the second quarter.

The partnership with Ctrip would spur both companies' growth, allowing them to access each other's portfolios, Priceline chief executive Darren Huston said. 

It would bring to Priceline more appointments from Chinese voyagers traveling to another country just as increment the determination of settlement and expand the organization's geographic reach inside the nation.

Priceline was under-represented in China when it came to accommodation, Huston said.
"It's like putting products on the rack. On the off chance that you put more items on the rack, it enhances the value of the store," he said.

An increasing number of Chinese tourists are shifting online to book their plans, a market that Priceline is eager to tap into.

"Our primary way of growing as a company has and will be organic growth, and the commercial side of this deal is critical to helping us keep up the fast pace of organic growth," Darren Huston said.

Priceline has used acquisitions to drive growth and surpass Expedia in revenue, including last year's purchase of Kayak Software for about US$1.7 billion.