Sina buys 9% of Tudou

Chinese web portal Sina (SINA.NASDAQ) has purchased a 9% stake in online video operator Tudou (TUDO.NASDAQ) in a bid to boost advertising revenues from video content, the Wall Street Journal reported. Sina bought approximately 1.08 million of Tudou’s American depositary shares during the company’s IPO in August, and then purchased another 1.49 million for US$35.2 million between August 17-25. Tudou holds the second-largest share of ad revenues produced by online video in China, right behind Youku (YOKU.NASDAQ). However, Tudou shares have continued to trade below their original IPO price of US$29. The online video sector in China is competitive and capital-intensive, and some executives are predicting a coming consolidation within the industry.