U.S.-based Priceline Group Inc. is investing USD500 million through a convertible bond to grab up to 10% of China-based online travel firm Ctrip.com International Ltd.

With the investment, Ctrip has granted Priceline permission to acquire Ctrip shares in the open market over the next twelve months, so that combined with shares convertible under the bond, Priceline may hold up to 10% of Ctrip's outstanding shares. Upon purchase of the convertible bond, Priceline will acquire the right to appoint an observer to the Ctrip board of directors.

Expanding on the existing commercial relationship established in 2012, the global partnership between the world's largest online travel group and China's largest online travel company will significantly promote tourism to and from China by allowing Ctrip's customers to reach Priceline's global portfolio of over 500,000 accommodations outside of Greater China, and Priceline Group's customers to reach Ctrip's over 100,000 accommodations in Greater China.

The new terms of the agreement build upon a history of cross-promoting accommodations inventory between the companies.