US travel giant Priceline ups investment by buying another $135M in Ctrip stock

Just a couple of months ago, American online travel company Priceline (NASDAQ:PCLN) invested US$500 million into Ctrip (NASDAQ:CTRP) in the form of a convertible bond. The agreement allows for Priceline to simply collect interest on the bond, cash it in, or use it to buy Ctrip shares, although it cannot buy more than 10% of the company.

Now, Priceline’s Schedule 13D filing for September has made it clear that it has an even deeper interest in the Chinese online travel behemoth. In addition to converting the US$500 million bond into 6,145,350 ADSs of Ctrip stock, Priceline has also picked up another 2,171,170 ADSs, for a total market value of nearly $135 million. That means that at present, Priceline has invested about $635 million into Ctrip, and owns a 5.84% share.

(For those looking to diversify their portfolio, an ADS is an American Depository Share: a share of a foreign company that can be purchased at dollar value on American stock markets.)

In addition to Priceline’s share of Ctrip’s shares, the companies also have a commercial partnership that was significantly expanded as part of the initial US$500 million investment agreement. That agreement gives Ctrip customers access to some of Priceline’s offerings, like hotels and rental cars.

(Source: SEC Schedule 13D)