In a statement today, AOL said the yet-to-be-named joint venture will be capitalized at US$200 million with both companies contributing about US$100 million over time. Legend will have a 51 percent stake in the joint venture, with AOL holding the remainder.
The new venture will combine AOL's expertise in bringing online services to consumers with Legend's experience in the Chinese consumer PC and interactive services markets, AOL said in the statement.
AOL International president Michael Lynton said the joint venture represented an opportunity for both companies to tap the potential of the Chinese Internet market.
Legend president and CEO Yang Yuanqing called the partnership "a historic step for Legend's Internet business". "It (the joint venture) will provide interactive services, consultation and technical support in the near term. As China accesses to (the) WTO, we are confident of China's market development potential and environment. The joint venture will also gradually expand its scope of activities," he added.
Legend's PCs are said to account for about 39 percent of the consumer PC market in China. In addition, it has an integrated portal called fm365.com, which offers Internet users in China a variety of online information.
As of May, Legend claims to have 1.7 million interactive services users, 2.9 million registered email users and 34 million page views from fm365.com.
US-based AOL claims to have more than 29 million members in 17 countries across the Americas, Asia Pacific and Europe.
In Asia Pacific, AOL has alliances with NTT DoCoMo in Japan and AAPT Ltd, a telecommunications company in Australia, the statement noted.
In the US, AOL Time Warner Inc shares last traded at US$51.05, down US$0.65. Legend shares closed unchanged at HK$5.65 on the Hong Kong Stock Exchange.