Rakuten will sell 13.29 million American Depositary Shares (ADS) of Ctrip. Morgan Stanley will act as Rakuten’s underwriter and Citibank as co-underwriter. The stake that Rakuten bought for about 103 million US dollars in mid-2004 is worth about 575 million dollars at current market prices. 

“Rakuten had originally invested in Ctrip to gain access to China’s online travel market,” said Seiji Kasashita, Rakuten’s spokesman. “But now that Rakuten’s Shanghai office is gaining presence in the local market, it decided to sell.”

Rakuten said in a statement that it would maintain its positive relations with Ctrip. And Sunjie, CFO of Ctrip, indicated that the sale wouldn’t affect the company’s operation, as Ctrip has laid a solid business foundation.

However, the price of Ctrip on Nasdaq fell 7.6 percent to 40 dollars due to the stake sale, although Ctrip posted a stronger-than-expected 46 percent increase in net profit to reach 11.6 million dollars for the second quarter of 2007. (Edited by Yang Liu, )