Shanda Interactive Enter-tainment, China's leading online games company, has bought a 19.5 per cent stake in Sina, the country's biggest internet portal, for $196m in a surprise move that could pave the way for a takeover.

Such a move would transform China's fast-growing and fiercely competitive online sector, uniting the country's two biggest Nasdaq-listed internet ventures into a potential national champion spanning online role-playing, news, entertain-ment and wireless messaging.