Barry Diller, chairman and chief executive of the new company, told reporters the operation may be up and running within a year.

He said it will be a media and advertising Web site rather than a transaction-based business, and he plans to bring the IAC's search engine Ask.com to China within two years.

To date, IAC has invested $200 million in China, which has a reported 162 million users, the second-largest Internet user base in the world, the Wall Street Journal said.

IAC announced earlier this month that it will divide the $9 billion firm into five separate companies, with Diller at the helm of its 30 Internet businesses, including city-guide Web site Citysearch and personals Web site Match.com.