A worker watering flowers around an installation reading "Follow Our Party Start Your Business," in front of Tencent's headquarters in Shenzhen, China in March.

Prosus (PROSY), a spin-off by South African media and web funding agency Naspers (NAPRF), offered a 2% stake in Tencent (TCEHY) for HK$114.2 billion ($14.7 billion), the Chinese tech large stated in a Hong Kong Stock Exchange submitting on Thursday. Tencent, which reported a powerful monetary yr in the course of the pandemic, is by far Nasper’s most successful funding.

The deal is the most important block commerce ever, in response to information supplier Refinitiv. Block trades are sometimes organized immediately between massive institutional traders somewhat than on public inventory exchanges.

Tencent’s inventory dropped 1.5% on Thursday in Hong Kong after the information. It has gained about 80% since Prosus was listed on the Amsterdam inventory change in 2019.

After completion of the deal, Prosus will stay Tencent’s single largest shareholder, with 28.9%. But it’s going to lose its controlling shareholder standing, which below Hong Kong itemizing guidelines is granted to traders who maintain at the very least 30% of voting rights.

Prosus mother or father Naspers paid $32 million again in 2001 for a 46.5% stake in Tencent. Its remaining stake is now worth $221 billion. It’s a return that’s rivaled solely by SoftBank’s (SFTBF) $20 million punt on Alibaba (BABA) in 2000.
Tencent's profits are soaring. But investors are worried about a crackdown by ChinaTencent's profits are soaring. But investors are worried about a crackdown by China
The deal will give a major increase to Prosus’ money reserves. The Amsterdam-based funding agency reported a internet money place of $4.3 billion late final yr.

“Prosus intends to use the proceeds of the sale to increase its financial flexibility to invest in growth, plus for general corporate purposes,” Prosus stated in an announcement.

It additionally promised to not promote any additional Tencent shares for at the very least the following three years.

Tencent final month posted a huge jump in profit for the fourth quarter of 2020, beating estimates. But the outcomes have been overshadowed by considerations of a growing government crackdown on Chinese tech firms.
Prosus, which primarily invests in client web firms, said final November that its companies have benefited from development traits in that area, because the pandemic has accelerated digital transformation.

“The focus now is on growing the business and improving financial flexibility and giving ourselves the room to be able to deploy across multiple capital allocation opportunities,” Basil Sgourdos, monetary director and govt director of Naspers, stated in an earnings name in November.

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