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eLong Inc. Message Board

  • ibanker_nyc ibanker_nyc Jun 26, 2012 8:29 PM Flag

    Expedia and Tencent Ownership - part 2


    In terms of M&A:

    a) Priceline, the big one in the room, could try to buy CTRP
    b) EXPE could buy ctrip, consolidate platforms, take out costs and couponing and immediately accretive
    c) Quinar (through BIDU) may acquire CTRP
    d) For eLONG, the biggest downside is that their is no other potential suitor out there apart from EXPE. But either of a, b, or c, should reward eLONG shareholders in the long run.

    The lack of liquidity is a major concern, but that is essentially equivalent to a big short interest. When things spike, they spike BIG. Howver, if things go down, they go down BIG. All you need is a 20,000 shares owner to puke and you could easily see a 10% correction.

    Bottom Line

    What happens to the stock from here is anyone's guess. But similar to any investment you may have in Coal companies now, the downside is very limited. Think about it as a blackjack game where you draw 20 from your first two cards and dealer has to draw. You will obviously stay put, there is obv a probability that dealer gets to 20 or 21..

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    • Thanks for the great summary- CTRP not great numbers- The key is the timing or when the cutthroat competion eases up a bit- Right now we are in the eye of the storm.

    • i dont think the spike to $26 happened bc of that. people were psyched that tencent was going to promote elong to their 500-700 million users after investing in the co. stock went from $17-$26 (as it should have). Wall st is just ignorant about elong and its off the radar. soon that will change

      elong is Expedia's $1+ billion ace in the hole.

    • Hey:

      Good stuff, I have started my research on this stock. One of things I look at is who follows the stock, Saw the Brean Murray change the price target - i.e. lower, but do you know of anyone else that follows this stock?

      I notice too, they have been going to some internet conferences i.e. Goldman and others...

      • 2 Replies to loblolly7
      • Thanks.

        Bloomberg has EVA Dimensions, but price target not disclosed.

        Conferences: That is goldman and others' way of wooing expedia.

        Today was good!

      • I've been in elong for 5+ years since 2004/2005. Expedia has executed a stealth, secretive, quiet buyout of eLong. Their whole plan is to execute this plan until their happy with their total holding %. this has to be getting close bc expedia and tencent now control over 83%. New buyback will take it close to 90%. Expedia management are very very smart. Partnering with Tencent is a genius move bc they reach almost every web user in China. this $30 million buyback could be the last step of Expedia's secretive buyout as their execs, who are on the eLong board, approved this buyout. they control all the decisions.

        Last step will be either Expedia or Tencent buying out the last 10% of owners at $30 or more. Maybe $35-$40

        remember...hotel room night booking growth is over 5.5% a MONTH. 67% a year. eLong is absolutely rocking, Expedia and tencent know this, and this is the final stealth buyout move.

        guangfu cui and his team have done a fantastic job overall. these people own shares. Expedia/Tencent are going to take care of them. thats why the management team is so stable, little turn over, etc.

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