Tencent Wants Its Fare Share in India

Tencent Holdings Ltd. is leading a $1.1 billion round of investment for the popular Indian ride-hailing company Ola — the internet giant’s latest foray into the massive South Asian market.

“The strategic partnership with Ola makes it possible for Tencent to be part of the fast-growing ride-hailing space” in India, Tencent President Martin Lau said in the statement issued by Ola.

Existing Ola investor SoftBank and a number of U.S.-based investors are also participating in the round, Ola said in the statement Wednesday. Bengaluru-based Ola is American ride-hailing giant Uber’s biggest rival in India.

Ola did not specify the specific amount of funding Tencent was providing, but the Indian publication The Economic Times reported in July that the Chinese internet company at the time was considering a $400 million investment in Ola.

Tencent has been looking to spread its influence in India this year across multiple industries. In April, Tencent was part of a $1.4 billion financing round for Flipkart, India’s largest online retailer. In October 2016, Tencent and global media company Naspers became the two largest shareholders of Indian travel startup MakeMyTrip.

Uber and Ola have been engaged in a fierce battle for the Indian transportation market, similar to the months-long showdown between Didi Chuxing and Uber in China that ended in a merger in August 2016.

Softbank, Ola’s largest existing backer, has also reportedly agreed to make an initial investment of up to $1.25 billion in Uber, CNN reported last week, in a move that could be a turning point in the two companies’ rivalry.

Ola, founded in 2011, said it was also in “advanced talks” with other investors over a possible $1 billion in additional funding.

Tencent’s investments are part of a larger trend of Chinese capital pouring into India. Fellow Chinese internet player Alibaba Group Holding Ltd. owns a stake in Indian digital payment firm Paytm, and its entertainment arm Alibaba Pictures Group Ltd. bought a majority stake in Chennai-based online ticketing platform TicketNew in June.

Contact reporter Teng Jing Xuan (jingxuanteng@caixin.com)

Correction: The original version of this story inaccurately described the Didi-Uber deal.