Baidu, Alibaba and Tencent could spend more than $80 billion for mergers and acquisitions this year, according to BNP’s estimate, as the trio - known collectively as BAT - continue consolidating unprofitable startups and buy innovative companies to get an edge in the mainland’s fiercely competitive e-commerce market.
Baidu, which listed on Nasdaq in 2005, has dominated China’s search market since 2010 when Google pulled out of China over censorship and cyber attacks.
Alibaba has outpaced its online rivals through its profitable retail sites Taobao and Tmall, while Tencent owns WeChat, or Weixin in Chinese, a messaging app that had more than 650 million active users as of September of 2015.
US-listed Baidu made 23 investments totaling $1.1 billion last year, according to data-tracking firm Dealogic. The Chinese search engine firm led a group of investors in Uber China’s $1.2 billion private round. The investment in the Chinese outlet of the car-hailing app was the largest single transaction for Baidu last year.
Alibaba, also listed in New York, made 15 investment totaling $11 billion last year. The Hangzhou-based ecommerce behemoth, controlled by former English teacher Jack Ma, invested $4.6 billion in Chinese electronics retailer Suning Commerce Group, the biggest step in its drive to integrate online and offline shopping platforms.
Hong Kong-listed Tencent made 55 investments totaling $3.8 billion last year. The Shenzhen-headquartered company was one of 10 nvestors in Postal Savings Bank of China’s $7 billion private round in December, highlighting its appetite to strike deals with traditional banks amid a push by Beijing to expand internet finance for small borrowers in rural areas.