(July 7): Tencent Holdings Ltd sold US$1.5 billion (RM6.1 billion) of stock in Chinese TikTok rival Kuaishou Technology, paring mature internet bets during a pivot to artificial intelligence (AI).

China’s most valuable company sold about 273 million Kuaishou shares at HK$43.25 (RM22.50) apiece in the biggest such block trade in Hong Kong this year, according to terms of the deal seen by Bloomberg News. That was towards the lower end of a marketed range and a 6% discount to Kuaishou’s HK$46 Monday close. The short-video company’s shares slid as much as 9.3% on Tuesday, the most on an intraday basis since March.

The WeChat operator has over the years unwound investments in mobile internet platforms including Meituan and online retailer JD.com Inc, as well as holdings in smaller game studios. The Kuaishou selldown accelerates that trend as Tencent redirects capital into generative AI, backing high-profile start-ups from DeepSeek to Moonshot AI. The company also participated in a US$2.8 billion financing round for Kuaishou’s Kling AI, investing directly in the creator of one of China’s most popular generative video services.

The Tencent transaction surpassed an earlier US$1.5 billion selldown in printed circuit board supplier Kingboard Laminates Holdings Ltd, data compiled by Bloomberg showed. Hong Kong share sales have powered to a five-year high on investor enthusiasm around artificial intelligence, though the city’s stock market has been a laggard.

Tencent’s stake will drop to 9.37% after the selldown. Kuaishou’s shares were propelled last year by the rapid rise of Kling, though that market fervour has since cooled. The operator of China’s second-largest short-video platform is counting on AI video as a second leg of growth. Kling AI is expected to get spun off and floated on public markets eventually.

Tencent will face a 90-day lock-up on its remaining stake after the block trade. Goldman Sachs Group Inc and Morgan Stanley arranged the deal.

Uploaded by Tham Yek Lee