US travel giant Expedia has offloaded its 62.4% stake in Chinese online travel agent eLong.
Expedia said it raised US$671 million from the sale, to a group of Chinese companies including rival Chinese travel firm Ctrip.
Ctrip separately said it had acquired a 37.6% stake for about $400 million.
The deal ends Expedia’s decade long investment in eLong, a company which continues to underperform, weighing down on Expedia’s profits.
It is being seen as a positive step for Expedia after the company’s shares rose sharply on the news.
In recent times eLong has been squeezed out as China’s big two, Ctrip and Qunar, fight for dominance in the Chinese market.
As part of the deal, both Ctrip and Expedia "agreed to cooperate with each other to allow their respective customers to benefit from certain travel product offerings for specified geographic markets."
Expedia remains bullish on the China market and is not about to pull out altogether.
"Expedia’s longstanding commitment to and focus on the opportunity in China, including domestic and international inbound/outbound travel, has not changed and our commercial relationship with eLong remains in place," the OTA said.
