Google Inc. said Thursday that it sold its 2.6% stake in Baidu.com Inc., operator of China's most popular search engine. The U.S. company said that it would focus on developing its own business in the country.
"It looks like Google and Baidu.com will each attack the Chinese market independently," said Steve Weinstein, an analyst at Pacific Crest Securities in Portland, Ore. "Both have done a good job to date to gain share in China and hold off competitors."
Google, which in January released a censored version of its search engine for China, bought the stake in Baidu for $5 million in June 2004, more than a year before the Chinese company's initial public offering last August. The 749,625-share stake would have been worth $63.3 million based on Baidu's closing price Wednesday.
Google had disclosed in a June 20 regulatory filing that it planned to sell the Baidu stake.
China's 111 million Web users make it the second-biggest Internet market. That number is expected to reach 232 million by 2010, according to market researcher iResearch.
Thomas Smith, a spokesman with Baidu's outside public relations firm, didn't have an immediate comment on the sale.
Shares of Google fell $2.18 on Thursday to $399.95. They have fallen 3.6% this year. Baidu's U.S.-traded shares fell $4.20 to $80.20. They have risen 27% this year.