• Airplane tickets and a Ctrip.com envelope on a table in Beijing, China.

Airplane tickets and a Ctrip.com envelope on a table in Beijing, China. (Photo : Getty Images)

UTour Group Co Ltd., an outbound travel agency, has decided against acquiring a Ctrip subsidiary. It was discouraged by an overly prolonged transaction and the uncertainties regarding delisting policies.

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According to UTour's Thursday filing on the Shenzhen bourse, Utour has terminated a $378 million deal to purchase Hytours, which is chiefly owned by NASDAQ-traded Ctrip.

The proposed deal was seen as an alliance between two of the most influential outbound-travel providers in China. It was proposed last March 2016.

Rosy prospects were cut short two months after the deal was proposed, as China's stock regulators began scrutinizing all possible market violations linked to the delisting of listed Chinese companies in the U.S.

Wei Changren, the CEO of travel consultancy Jinlu, said: "Ctrip’s listing on the NASDAQ has added to the complications of the deal, and was one of the reasons the deal was killed. Whether and how Ctrip--the largest stakeholder of Hytours and an overseas traded company--would delist depended largely on expected policies."

The deal was retracted although it received a go-signal from regulators. UTour said that this is due to the “remaining uncertainties regarding delisting policies and the overly time-consuming process of the transaction would encumber all parties.”

Wei said that the proposal had to be abandoned because of the new situation.

He added: “During the yearlong wait for policies to clear up, domestically traded UTour’s valuation has tumbled along with other A-share stocks, making the original transaction price appear too expensive.”

Elong and Qunar, the former rivals of Ctrip, both returned to the mainland from U.S. exchanges in the second quarter of 2016. This was the time when U.S. regulators began closely monitoring delistings.

“The termination of the deal will not affect larger company strategies; UTour and Hytour will proceed with other areas of cooperation,” said UTour Director of Strategic Investments Guo Luo.