Sina which acquired 1.075 million shares in the IPO last month for $31.2 million, as reported in a filing with the Securities and Exchange Commission, has spent another $35.2 million for an additional 1.49 million Tudou shares, raising it’s holdings to 9.05 percent.
In a strategic move, Sina is adding video services to attract more users in what is arguably the world’s biggest Internet market.
Their investment in Tudou, China’s second-biggest video website, (#1 is Youku.com), is on the heals of Sina’s acquisition of a minority stake in online apparel retailer Mecox Lane Ltd. (www.M18.com ) earlier this year.
Sina says it plans to spend $100 million to develop its Weibo microblogging service to attract more users.
Tudou share price has dropped about 11 percent in trading on the Nasdaq stock market since its $174 million IPO.
After the announcement, Tudou shares rose 2.5 percent to $25.73, which is still low in comparison with their IPO price of $29. The company says it plans to use proceeds from the sale to acquire more video content and upgrade their technology.