China's biggest-by-far OTA Ctrip has announced an RMB 3 billion ($460 million) investment in China Eastern Airlines, one of the world's biggest airlines in terms of passenger numbers.
The deal, which is with the airline's state-owned parent company China Eastern Air Holding Company, also includes a far-reaching strategic partnership.
"Low-cost transportation solutions, international air travel, IT technology, travel insurance, and e-commerce," are mentioned as areas where the two will work together.
Ctrip also has the option to increase its stake and get a seat on the board.
Ctrip is arguably the most prolific OTA in terms of its global M&A activity and its investment in a state-owned airline company is another interesting move.
The statement doesn't specify how big a stake in China Eastern Ctrip is getting for its RMB 3 billion, though less than a year ago Delta spent $450 million on a 3.55% stake in the airline.
China Eastern carried just under 100 million passengers last year, and operates a network of 350 domestic and 40 international routes, according to its CAPA profile. It joined Skyteam in 2011 and through the alliance is able to serve more than 1,000 destinations in 177 countries from its Shanghai hub.
Its frequent flyer programme Eastern Miles has more than 20 million members, according to its Skyteam profile.
While the airline is the biggest business within the parent group and the most obvious synergy for an OTA, Ctrip is also now involved in its other units, including aviation real estate, financing, catering, media and duty-free.
The move could also be a sign of a changing relationship between airlines and OTAs in China. Qunar, which is 45% owned by Ctrip, saw two major Chinese airlines withdraw their inventory from Qunar over alleged customer service issues.
Related reading from Tnooz:
Ctrip Group lifts GMV 2020 projection to around $200 billion (March 2016)
Ctrip invests $180 million in MakeMyTrip (Jan 2016)