After paying $1.9 billion for 91, Baidu is still quietly catching up on its LBS+O2O model, negotiating with various potential partners. Reliable sources from the investment community revealed that after talks with Dianping fell through, negotiations between Baidu and Renren's Nuomi.com are entering the final stage.
No beating around the bush, here's what I know:
1. M&A negotiations between Baidu and Nuomi.com have been ongoing for two months and are now in the due diligence phase. The main point of contention is that Nuomi.com does not want to be sold but rather wants to bring in an investor. However, Baidu’s usual style is to take a controlling stake. Regarding the rumored acquisition of Nuomi.com, Baidu stated it would not comment. A PR representative from Renren also claimed to be unaware.
2. Notably, before Nuomi.com, Baidu had been in contact with Dianping hoping to acquire them. In fact, another giant, Alibaba, was also in touch with Dianping about a possible acquisition. However, both Baidu and Alibaba's desire to acquire clashed with Dianping's unwillingness to be sold, ultimately leading to the breakdown of negotiations. This speculation is supported by comments from Dianping co-founder Long Wei, who stated: "The possibility of Dianping going public independently is greater; accepting investments from giants is unlikely."
3. An investor close to Baidu analyzed that after the failed acquisition talks with Dianping, acquiring Nuomi.com became a second-best choice.
4. A well-known group-buying site CEO said that as a company with significant traffic, although Baidu Maps is expanding, it lacks users and e-commerce capabilities. By acquiring or investing in Nuomi.com, Baidu can more importantly gain access to core group-buying users and learn e-commerce skills. Moreover, if Baidu were to acquire a group-buying site, it would help Baidu Maps form a closed-loop transaction system.
5. However, another group-buying industry executive believes that the capital operation between Baidu and Nuomi.com might eventually result in an investment rather than an acquisition. A group-buying company CEO mentioned that Baidu Maps currently follows an open platform route for group-buying. If it acquires Nuomi.com, it could affect other group-buying sites' willingness to join the platform. Additionally, for the current Baidu Maps, before mobile payments become significant, the best way to monetize remains the group-buying open platform.
6. Notably, Baidu's exploration of the LBS+O2O model has always been exceptionally challenging. A group-buying site executive said that in 2012, Baidu had discussed investment opportunities with him, but ultimately decided to do it themselves. Despite heavy investment in iLehuo and group-buying businesses, which benefited from Baidu's massive traffic, they did not succeed. Thus, after repeated failures, Baidu decided to adopt M&A and investment strategies.
7. Nuomi.com is a big burden for Renren, consistently operating at a loss. According to Renren's first-quarter financial report, Nuomi.com incurred a net loss of $6.9 million. If Nuomi.com were sold to Baidu, this would relieve Chen Yizhou of this burden. Of course, this burden would then be transferred to Baidu.
8. Another piece of news is that Baidu is also in talks to invest in Dingding Map. Dingding Map previously received a 30% investment from Alibaba, and there are rumors that the founding team, in order to avoid being fully acquired by Alibaba, is actively seeking investors and negotiating with Baidu. However, personally, I believe that even if Baidu and Dingding Map are interested, Alibaba would likely disrupt this deal—you understand why. As usual, Baidu remains silent on this matter.