Hony backs US-listed Tuniu.com

John Zhao’s firm has bought $148m worth of shares in the Chinese online travel business

A consortium of Chinese investors, including private equity firm Hony Capital, has acquired $148 million worth of newly-issued shares in Tuniu Corporation, a Chinese online travel business listed in the US, according to a statement.

The investor group, which includes JD.com, Ctrip Investment Holding and Tuniu management, will pay just over $4.2 per ordinary share in the NASDAQ-listed business, or the equivalent to $12.061 per American depositary share.

Hony, investing through its special purpose vehicle Unicorn Riches, and Chinese e-commerce giant JD.com will each make an investment of $50 million – the largest individual commitments from the consortium. Each of the investors has agreed not to sell, transfer or dispose of any shares acquired in the transaction for six months after the closing.

Tuniu is a Chinese online leisure travel business, which offers tour packages and other travel-related services to its customers. It currently employs around 600 travel agents across its headquarters in Nanjing, a regional call centre in Guangzhou and 60 other regional offices in China.

“We are pleased to welcome Hony Capital and JD.com as our new investors. We look forward to cooperating with JD.com in the near future. We also expect to deepen our partnership around shared travel resources with Ctrip, one of our existing shareholders, which further increased its holdings in Tuniu through this placement,” Dunde Yu, chairman of the board and chief executive officer of Tuniu, said in a statement.

John Zhao, founder and chief executive of Hony, added, “The internet, especially mobile internet is changing people’s lifestyle and influencing many traditional industries. Hony Capital focuses on how new technology transforms traditional industries through the combination of online platform and offline service.”

China’s booming internet sector has provided a number of opportunities for private equity players, most notably with JD.com’s main rival, Jack Ma’s Alibaba Group, which counts Silver Lake Partners, China Investment Corporation and Boyu Capital among its investors. Alibaba listed on the New York Stock Exchange in a $25 billion IPO in September this year – the largest ever seen globally.