Chinese internet and e-commerce firm Alibaba has announced that it will acquire a 16 per cent stake in Sohu's search engine Sogou.
The move is an attempt to expand its online presence in the world's largest internet market.
Sohu said in a statement that Alibaba, along with Yunfeng, a funding company set-up by Alibaba chairman John Ma, will purchase the 16 per cent stake in Sogou. Another 16 per cent will be purchased by a funding company formed by its founder Charles Zhang.
Sogou is the third most popular search engine in China, after Baidu and Google, but only holds 0.8 per cent of the market share.
Alibaba is yet to announce which search engine it will use to power its Yahoo China search function, which it received after US-based Yahoo acquired a 40 per cent stake in the company.
Yahoo Japan had invited controversy after it selected Google to power its search engine, snubbing Microsoft's Bing, which powers Yahoo's US search engine following a deal between the two companies.