BEIJING, Dec 17 (Reuters) - Chinese internet firm Qihoo 360 Technology Co Ltd said it would invest $409 million in a joint venture with Shenzhen-based smartphone maker Coolpad Group Ltd.
The joint venture, announced late on Tuesday, will look to combine Qihoo 360's internet and software know-how with Coolpad's experience making smartphones, under the brand of Dazen. Qihoo 360 will hold a 45 percent stake and Coolpad will own 55 percent.
The partnership, combining software tailored for the hardware and selling the Dazen phones online using internet marketing, follows in the footsteps of Xiaomi Inc, now the world's third largest smartphone maker.
Xiaomi relies on the internet and word of mouth to hype its cheap, quality handsets. It was also China's biggest smartphone maker by market share in the third quarter of 2014, according to data firm Canalys. Coolpad was the fifth largest, although still ahead of Apple Inc
"The JV will leverage Coolpad's extensive expertise in smartphone design, manufacturing, supply chain management, and aftermarket services, while benefiting from Qihoo 360's strong capabilities in Internet security software, mobile apps development and online marketing," said a Coolpad statement on Wednesday.
Qihoo 360, which specialises in online search and security software, will also be the main provider of Dazen's mobile app store. (Reporting by Paul Carsten; Editing by Anand Basu)