Baidu buys into

09:20, May 18, 2011      

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Richard Liu, chairman and chief executive officer of, said Baidu's Robin Li invested in his company last year, taking a stake of less than 1 percent. Zhang Tao / China Daily

Robin Li, founder and chief executive officer of the search engine company Baidu Inc and the richest man on the Chinese mainland, has invested in, a company that started by mainly selling computers, communication and electronics over the Internet.

When measured by its market share, is the biggest website selling directly to consumers in China.

Li is the latest in a series of famous investors who have wanted to own part of, a company valued at about $10 billion at the end of last month.

Among the others are the Walton family, which controls Wal-Mart Stores Inc, and Digital Sky Technologies, the Russia-based Internet investment group that owns stakes in Facebook Inc and Groupon Inc. Both took part in's third round of financing, in which it raised $1.5 billion.

"Robin Li invested in us last year, taking a stake of less than 1 percent," Richard Liu, chairman and chief executive officer of said at a news briefing in Beijing on Tuesday. The announcement surprised many, especially since Liu has complained about Baidu Inc's decision to sell to competitors the brand name "Jingdong", the Chinese name for

Liu even hinted in his micro blog in April that might cease advertising on Baidu because of what he deemed to be the company's unethical behavior.

"We have worked with Baidu for years and hoped the search engine giant would bring traffic to," Liu said. He said Robin Li called him in protest. "Although Robin is my investor, I will still criticize wrong practices," Liu laughed.

Founded in 1998, has seen its annual revenue increase by more than 200 percent in the past six years. It brought in annual revenue of 10.2 billion yuan ($1.6 billion) in 2010 and that figure is expected to climb to between 24 billion and 26 billion yuan this year.

In 2010, the company grabbed 32.5 percent of the Chinese market for goods sold directly to customers over the Internet.

It's followed by and the New York Stock Exchange-listed, similar websites that each have 9.2 percent of that market, according to the consulting firm iResearch.

The listing excluded, the largest online retail site in China measured by sales, which runs a website that sells directly to consumers and also allows consumers to sell to one another.'s direct sales to consumers have about three times the value of those made through to consumers, said Chen Shousong, an analyst with Analysys International.

"The competition between and is becoming increasingly intense," he said.

On Tuesday, announced it will cease cooperating with within a week. Analysts said might no longer want to work with a company associated with, which, along with, is owned by Jack Ma, the founder and CEO of Alibaba Group Holding Ltd.

"Richard Liu said Alipay charges high transaction fees, but I don't think that is the deep-rooted reason," said Zhang Meng, an analyst with Analysys International. plans to list in the United States no later than 2012, and hopes to raise $2 billion from the capital markets, according to Liu.

Source: China Daily
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