Baidu Inc’s (BIDU.O) proposed sale of online video unit iQiyi to its own chief executive is not in the interests of long-term shareholders and may permanently damage the reputation of the company, an investor in the Chinese internet firm said.
In February, Baidu received an offer for its 80.5 percent stake in iQiyi from the chief executives of the two firms.
“We worry that embracing what is an inherent conflict of interest will lead to damage to the reputations of both you and Baidu,” Acacia Partners said in a July 18 letter to Baidu CEO Robin Li.
The letter was distributed to media through public relations firm Finsbury, part of communications firm WPP.
“It is better for Baidu to be regarded as a key institution, not the extension of the pocketbook of one man,” the letter said.
A spokeswoman for the Chinese search giant declined to comment.
(Reporting by Paul Carsten; Editing by Edwina Gibbs)