Alibaba-backed Chinese food delivery firm Ele.me will take over the food delivery unit of search engine giant Baidu in a deal that could be worth up to $800 million, the firm and a report said Thursday.
Shanghai-based Ele.me, which means "Are you hungry?" in Chinese, said it would take control of Baidu Waimai, which will continue to operate under its own name and management and also will receive shares of Ele.me.
Further details were not given.
But the state-run China Business News reported that the deal will be financed with a mix of cash and Ele.me corporate shares that will value Baidu Waimai at $500-800 million.
Alibaba, which invested $1.25 billion in Ele.me in April 2016 together with its financial arm Ant, plans to inject at least another $1 billion, Bloomberg News reported in May.
Based on mobile apps, the food-delivery industry has boomed in China and especially in big cities like Beijing and Shanghai thanks to the growing number of mobile internet users and online payments in the country.
Ele.me has 260 million users in 2,000 Chinese cities served by three million scooter-riding delivery staff, its statement claimed.
Ele.me has 42 percent of the market share, just ahead of its biggest competitor Meituan Waimai’s 41 percent, according to Internet consultancy Analysys International.
Baidu Waimai has 13 percent.