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TechNode, VentureBeat’s partner in China, has learned from multiple sources that Asian powerhouse Tencent has acquired a stake in Dianping, China’s version of Yelp, and will announce the deal as soon as the coming week.

The rumor that Tencent and Dianping were in talks about an acquisition or investment has swirled for a while.

What we’ve been told is that Tencent has bought 20 percent  to 25 percent of Dianping at a valuation of $1.8 billion to $2 billion.

Around last October, Baidu reportedly wanted to to buy the whole of Dianping for $2 billion. In 2011, the latter company was valued at about $1 billion a the round of funding exceeding $100 million. From 2005 to 2010, Dianping received multiple rounds of funding from investors including Sequoia Capital China and Google China.

Edward Long (aka Long Wei), co-founder of Dianping, said he would not sell the whole company and had no plan for IPO in the near future when asked about the acquisition rumor at a conference last November. Zhang Tao, co-founder and CEO, said last year that the company might launch an IPO within five years.

Founded in 2003, Dianping has been in business for 11 years. It is the largest ratings and reviews service in China. As of the fourth quarter 2013, monthly active users were 90 million, with 75 percent of all pageviews coming from mobile devices.

There are 8 million merchants and 30 million ratings and reviews on the platform. Dianping’s services cover 2,300 cities in China and a dozen other countries.

Although it doesn’t have a major competitor in ratings and reviews in the Asian markets, its rivals are from group-buying and other lifestyle or local services. Since its consumer-facing sales are mainly from group-buying, Meituan and a couple of other group-buying services are direct competitors. Dianping claimed it became the forerunner in terms of market share in the first- and second- tier cities as of the end of 2013. However, Meituan claimed it had had 50 percent overall market share in late 2013 and managed to turn a profit at the year end.

Dianping also makes revenues from advertising and other services for business.

Although it hasn’t been growing as quickly as its grou-buying competitors in China, Dianping has big plans for this year. The company has launched food delivery service and is building a hotel booking service. It also has spun off the business division for wedding-related information and will possibly come up with other services for 2014.

We expect Tencent will integrate Dianping content into its properties, especially WeChat, the almighty mobile messaging app whose Official Account system enables traditional merchants to do CRM or even sell goods directly. Tencent, which is notorious for developing/copying all kinds of web and mobile services, has its own ratings and reviews, group-buying, and lifestyle services. But none of them is as successful as its communication software and gaming products.

This story originally appeared on TechNode. Copyright 2014

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