US travel agency Priceline buys into Ctrip for China push

Priceline, the largest online travel agency in the US, will invest US$500 million in Ctrip.com International to broaden the companies' options in China.

Priceline and Ctrip, which have had a commercial partnership since 2012, will increase their cross-promotion of each other's hotel inventory and other travel services, the companies said.

Ctrip, China's biggest travel website, is expanding its hotel-booking business as sales increase. Chinese revenue per available room rose 7 per cent in May, the highest growth since 2010. Ctrip's total sales climbed 38 per cent to about US$276 million in the second quarter.

The partnership with Ctrip would spur both companies' growth, allowing them to access each other's portfolios, Priceline chief executive Darren Huston said.

It would bring to Priceline more bookings from Chinese travellers going abroad as well as increase the selection of accommodation and broaden the company's geographic reach within the country.

Priceline was under-represented in China when it came to accommodation, Huston said.