Investing in AI while reducing holdings? After reports that Tencent plans to cash out over 10 billion HKD, Kuaishou confirms major shareholder is selling 270 million shares.
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Tencent and Kuaishou have repeatedly made headlines together this month. Just a few days after Kuaishou officially announced that Tencent is increasing its AI investment, news emerged confirming that Tencent is reducing its holdings.
On the evening of Monday, July 6 (Beijing time), Kuaishou Technology released a Hong Kong Stock Exchange announcement stating that the company has been informed that Tencent Holdings Limited sold over 270 million Kuaishou Class B shares on that day. The announcement did not disclose the selling price range or specific transaction size, but noted that after the completion of the sale, Tencent will no longer be a major shareholder of Kuaishou. It also pointed out that Tencent remains confident in Kuaishou’s prospects and that their strategic cooperation will continue.
Earlier on Monday, two media outlets cited sales documents indicating that Tencent planned to raise funds by selling about 273 million Kuaishou shares, accounting for about 7.5% of Kuaishou’s issued share capital. The price was up to 6.2% lower than Kuaishou’s closing price on the Hong Kong stock market that day. Based on the disclosed price range in the sales document, the maximum transaction size is about HKD 12.2 billion, or USD 1.55 billion.
Just last Thursday, July 2, Kuaishou announced external financing for its AI business, Kling AI, stating it expects to complete nearly USD 3 billion in funding, introducing strategic investors including Tencent. These two announcements, just four days apart, revealed that Tencent’s bet on Kuaishou AI and reduction of its equity stake almost happened simultaneously.
Kuaishou Confirms Equity Changes, Tencent Downgraded to Non-Major Shareholder
According to Kuaishou’s Hong Kong Stock Exchange announcement on the evening of July 6, Tencent sold a total of 272.9477 million Kuaishou Class B shares to several independent third parties with no connection to Kuaishou or its related persons via OTC block trades.
The announcement disclosed that after the sale, Tencent’s stake in Kuaishou would drop from about 15.68% to 9.37%, and Tencent will no longer be a major shareholder of Kuaishou.
Kuaishou emphasized that this placement does not involve new share issuance by the company, and the company’s business operations and relationships with relevant shareholders will not be affected.
The announcement stated that Tencent expressed its confidence in Kuaishou’s long-term development prospects, and both sides will continue to maintain a win-win relationship, including the continuation of strategic cooperation. Kuaishou anticipates that this share sale will not have any material adverse effect on its operations.
Media: Sales Documents Show Tencent Plans to Sell 7.5% Stake, Cash Out Up to HKD 12.2 Billion
Earlier on Monday, two foreign media outlets revealed structural details of Tencent’s share sale transaction.
According to media citing sales documents,Tencent’s wholly owned subsidiary Tencent Mobility plans to sell about 273 million Kuaishou shares, which is about7.5% of Kuaishou’s issued share capital. The selling price range is HKD 43.15–44.53 per share, representing a discount of about 3.2%–6.2% to Kuaishou’s Monday closing price of HKD 45.95.
Based on the upper limit of the price range, the transaction size is about HKD 12.2 billion (about USD 1.55 billion). Other media reported that Tencent proposed to sell Kuaishou shares valued at USD 1.51 billion at HKD 43.25 per share.
The share quantity, proportion and transaction size mentioned above were disclosed by sales documents or the media, but not listed in Kuaishou’s announcement on Monday night.
Media reported that Goldman Sachs and Morgan Stanley are joint book runners for Tencent’s share sale, and after completion of the block trade, the remaining Kuaishou shares held by Tencent will face a 90-day lock-up period.
Tencent did not publicly explain the specific reason for this share sale.
According to Yicai report, Tencent responded to the above media by saying, “No comment for now.”
Historically, Tencent has continued to optimize its investment portfolio in recent years, including reducing holdings in mature internet assets while retaining strategic cooperation relationships.
Just Injected Nearly USD 3 Billion Into Kling AI — A Contrast of “In and Out”
Four days before this share sale, on last Thursday, July 2, Kuaishou announced its AI business had achieved major financing progress, with new funding to be used for foundational model capabilities, computing infrastructure, and global expansion.
According to Kuaishou’s disclosure that day, Kling AI completed about USD 3 billion in financing. This round was jointly participated in by dozens of top-tier institutions, with a post-investment valuation reaching USD 18 billion, and Tencent listed among the joint lead investors.
According to Kuaishou’s announcement, the roster of investors is impressive, including Tencent, Alibaba Cloud, Baidu—the three major internet companies; state-owned industrial funds from Beijing, Shanghai, Shenzhen, Chongqing; Huace Media and Mango industry investors (Houwei Capital) from the entertainment sector. Lighthouse Capital participated as the sole financial advisor and dual role as L2F Lighthouse Entrepreneurs Fund co-investor.
Kling AI is a generative video model platform that Kuaishou is focusing on, considered as one of its future growth centers.
Against this backdrop, Tencent both participated in AI financing and reduced its holdings in the listed company, creating a clear contrast in capital allocation and becoming a focus of market attention.
Over a longer cycle, Tencent’s capital allocation strategy is gradually shifting from “broad coverage holdings” to emphasizing efficiency and strategic focus.
On one hand, the company optimizes capital returns by reducing mature assets; on the other hand, it continues to ramp up investments in AI, cloud computing, and foundational models. Amid a sustained intensification in AI capital expenditure, this kind of “structural reallocation” is becoming routine for major internet platforms.
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