Connect with us

Hi, what are you looking for?

Tech & Innovation

13% Drop In Tencent Shares As It Sells $3B Sea Group Shares

Tencent will be losing a majority of its voting power in Sea Group due to the selling of shares.

13% Drop In Tencent Shares As The Company Prepares To Sell Sea Group Shares

The Chinese internet giant Tencent recently announced that shares of Sea Group worth $3 billion will be sold off by the company. This had massive effects on the company’s outlook, bringing down their shares by 13% on Tuesday. The Sea Group also prepares to plan for the reduction of Tencent’s support in their organisation.

Tencent will be losing a majority of its voting power in Sea Group due to the selling of shares. The CEO of the latter company will now hold even higher voting power, increasing from 54% to 57%. The Sea Group also plans to implement further changes regarding its shares. As per reports, all Class B shares of the company will be converted to Class A, and the CEO will own all the converted shares.

The plan of the Sea Group is to create long-term strategies for growing their highly successful consumer internet business. While Tencent was a strategic business partner, the selling of a huge number of shares will be leading to major changes in their business relationship. However, Tencent has stated that it will not be selling any further Sea Group shares in the near future, and would prefer to hold on to the majority.

Tencent also has plans of its own. The money raised through the selling of these shares will be used to fund various social initiatives and investments, the company stated. Sea was one of their primary revenue earners in the first two quarters of 2021, with the latter company having secured a high-profit margin.

Sea Group has also been faced with certain restrictions in India due to them being backed by a Chinese Group. Such restrictions will most likely be lifted once Tencent withdraws its majority shareholding status from the company.

Click to comment

Leave a Reply

Your email address will not be published.