Tencent Slashes Stake in Kuaishou, Shares Fall

Shares of Kuaishou Technology fell more than 6 per cent on Tuesday morning after Tencent Holdings slashed its stake in the short-video platform by selling 273 million Class B shares, just days after leading a US$3 billion financing round for Kuaishou’s artificial intelligence video unit, Kling AI.

The divestment will reduce Tencent’s shareholding in Kuaishou to 9.37 per cent from 15.68 per cent, meaning the tech giant would cease to be a substantial shareholder, according to a Kuaishou filing to the Hong Kong stock exchange on Monday.

The filing did not disclose the transaction price or range, but based on Kuaishou’s closing price of HK$46 on Monday, Tencent is expected to raise HK$12.56 billion (US$1.6 billion) from the sale.

Kuaishou said the move was not expected to have “any material adverse effect” on its operations, adding that Tencent remained confident in the company’s long-term prospects and would maintain their business relationship.

In the same filing, Kuaishou also provided an update on its recently announced HK$16 billion share buy-back programme. The company has so far repurchased 174.84 million Class B shares for a total of HK$8.35 billion.

Tencent’s share disposal came days after it joined a group of Chinese investors, including tech heavyweights, state-backed funds and entertainment industry players, that led a US$3 billion financing round for Kling AI.