Beijing: China's leading Internet firm, Tencent Holdings Limited, has invested USD 448 million in Sogou, the search engine arm of internet company Sohu.

As part of the strategic cooperation, Tencent also merged its Soso search related businesses and other assets with Sogou, a press release published by Sohu said.

The companies said that Tencent which now holds 36.5 per cent of Sogou's equity capital on a fully-diluted basis, could increase to approximately 40 per cent in the near future, state-run Xinhua news agency reported.

"The move will expand Sogou's market presence and significantly elevate its position in the highly competitive PC search market, and even more so in the rapidly evolving mobile search market," Charles Zhang, Chairman and CEO of Sohu said.

Sohu, together with its affiliates, still remains the controlling shareholder of Sogou, which will continue to operate as its independent subsidiary.

Tencent and Sogou have agreed to jointly develop, cross-promote and integrate their respective products and services, while collaborating in areas of search technology, user insights and data sharing, the statement said.

According to market research institutions, Sogou's products include Chinese character input method on PC and on mobile devices, Pinyin and China's third highest used internet browser and search engine.
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