BEIJING, Jan. 5 (Xinhua) -- The head of China's third-biggest search engine Sogou said he expects his company to launch a US initial public offering with a valuation of as much as $5 billion－as it raises cash to close the gap with leader Baidu Inc in the mobile market.
Sogou, whose name means "search dog," plans to sell about 10 percent of its shares in an IPO that will probably be held this year, Chief Executive Officer Wang Xiaochuan said in an interview. The company, which is backed by social media giant Tencent Holdings Ltd and Sohu.com Inc, hasn't formally hired banks to run the listing. Sohu shares rose the most in 10 months on Wednesday.
While Baidu remains the biggest provider across all platforms in China, it's under siege after a scandal over medical advertising, as smaller rivals including Sogou and Qihoo 360 Technology Co win mobile users. Wang said he planned to use part of the IPO proceeds to improve search results by backing companies developing artificial intelligence and machine-learning technologies.
"Over the past year, we've seen a trend where people are finding themselves not trusting Baidu as much and some are even seeking a replacement," he said at the company's Beijing headquarters.
"So over the next year or two, as more people feel more comfortable with Sogou, they'll realize it is able to replace Baidu."
Shares of Sohu rose 4.9 percent to $35.54 in New York, the biggest gain since March 4. The stock has declined 34 percent in the past year.
Baidu accounted for 44.5 percent of mobile search queries in the third quarter, while Alibaba Group Holding Ltd-backed Shenma had 20.8 percent and Sogou was third with 16.2 percent, according to research from iiMedia.
Other independent researchers, including Analysys International, reported that Sogou was China's second-largest provider to the country's mobile users while some surveys have the company as the nation's second-largest overall.
Wang said Sogou could match Baidu in mobile search within three years. Baidu declined to comment. (chinadaily.com.cn)
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